Although it weakened, the hurricane-turned-tropical-storm was still dumping heavy rains, creating danger as water levels rose along the northern Gulf Coast.
The storm has had a "major impact" on Mississippi, Gov. Phil Bryant told CNN in Gulfport. "This is a man-made beach," he said, indicating the area where he was standing. "Most of that sand is gone. Thousands of homes have been damaged; people have been out of their homes and will be."
A tow truck driver attempting to clear debris on a road in Mississippi was struck by a falling tree, officials said. The incident took place at midnight, said Amanda Harris, deputy director of the Pearl River County Emergency Management office. The National Weather Service said it received reports of the fatality in Picayune, Mississippi.
On Louisiana's border with Mississippi, residents of Washington Parish were alerted that the Bogue Chitto River was expected to rise by 14 feet overnight.
To the southwest, in St. John the Baptist Parish, National Guard troops looked for people stranded after thousands were forced to flee when a surge forced water over the banks of Lake Pontchartrain.
"What we're doing is we have got law enforcement and fire personnel who are going door to door to notify people," Tommy Thiebaud, the Washington Parish director of emergency services, told CNN.
Some areas could see 25 inches of rain, the National Weather Service said.
Isaac's maximum sustained winds had dropped to 40 miles per hour as of 10 a.m. CT (11 a.m. ET) and it was moving north-northwest at 9 mph, the service said.
"On the forecast track, the center of Isaac will continue to move over Louisiana today, over Arkansas on Friday, and over southern Missouri Friday night," forecasters said.
In Plaquemines Parish, southeast of New Orleans, 3,000 people remained in an area close to an 8-foot-tall levee that was threatened by rising waters, Gov. Bobby Jindal's office said.
About 100 people who had ignored an evacuation order were rescued Wednesday in a flooded part of the parish, officials said. On Thursday, authorities from the sheriff's office and National Guard "will begin looking house to house to make sure they got everyone," Parish President Billy Nungesser said.
"We didn't have time to panic," Rafael Delgadillo of Braithwaite, Louisiana, told CNN on Thursday. He, his wife and daughter were rescued by a neighbor Wednesday. "We were in survivor mode," he said.
Nearly a million customers were without electricity across Arkansas, Alabama, Louisiana and Mississippi. Utility companies reported more than 978,000 customers without power.
Water boiling advisories were being issued in a number of towns and cities along the Gulf Coast.
A flash flood emergency was issued for Slidell, Louisiana. Surge flooding from Bayou Bonfouca and the W-14 canal gushed into parts of the city, and sudden inundation of up to 5 feet was possible in low-lying areas, the National Weather Service said.
Evacuations were under way in the city Thursday morning.
Authorities expected some street flooding in a few subdivisions on the south side of town, "but at present, that street flooding is minimal," the city said in a statement Thursday morning.
"There is water all around me," Vincent Molino, who lives in the area, told CNN in an iReport. "It looks like my home is in a lake. The area is completely flooded ... pretty much the whole neighborhood has three to five feet of water. We saw a big military vehicle stop by to ask us if we are OK.
"It is strange that the water is going down really slowly.
"The most amazing thing is that I still have power," Molino said.
Mississippi had 70 rescues along the Gulf Coast overnight, Gov. Bryant said.
At Mississippi's Lake Tangipahoa, a dam is "expected to fail," the National Weather Service said, issuing a flash flood warning until 11:15 a.m. CT (12:15 p.m. ET). Water levels could reach 8 feet, the service said.
If that happens, pastures and woodlands, along with some crops near the river, would be inundated, and parts of a highway would become impassable, forecasters said.
Throughout parts of the Gulf Coast, the National Weather Service warned, "life-threatening hazards from storm surge and inland flooding are still occurring."
Isaac is believed to have spawned three tornadoes overnight in Mississippi and Alabama, the weather service said.
Tornadoes are suspected to be behind damage in Gulfport and Jackson, Mississippi, while a twister is blamed for knocking down power lines and damaging a home in Geneva, Alabama.
President Barack Obama signed major disaster declarations