The Centre has also assured all possible help to the Punjab and Haryana governments to deal with any situation.
"We are in regular touch with the governments of Punjab and Haryana. Whatever help is required, will be provided," a home ministry spokesperson said in Delhi.
Security forces were carrying out flag marches at many sensitive places in both the states. Paramilitary forces have already reached Punjab and Haryana and many more are on way to sensitive places there.
Responding to reporters' questions, he said, "The state government would also call in the Army, if necessary, impose curfew according to time and circumstances and initiate all steps required to maintain law and order in the state."
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The state administration is continuously in touch with Dera followers for maintaining peace, Niwas said.
Dera followers have been assembling in large numbers at the sect's Sector 23 based "Naam Charcha Ghar" (congregation/ prayer centre) in Panchkula to show their solidarity with the sect chief.
"One lakh 'premis' (dear followers) have already arrived in Panchkula," Chandigarh DGP Tejinder Singh Luthra said and asserted that nobody will be allowed to disturb law and order.
He said elaborate security arrangements have been made with over 5,000 security personnel being deployed at sensitive and vulnerable points to maintain peace.
Gauri Prashar Joshi, the Deputy Commissioner of Panchkula, which has been declared a highly sensitive zone, said there is a heavy deployment of police and paramilitary forces near the routes leading to the district court complex in Panchkula.
All district administrations need to be in full strength, a spokesperson of the Haryana personnel department said, adding, "The leave, if already sanctioned, stands cancelled."
Haryana Health Department too has cancelled leave of all its medical and para-medical staff up to August 30.
As a precautionary measure, educational institutes would remain closed in Panchkula district and its neighbouring city Chandigarh until Friday, officials said.
The Haryana government said except for offices of essential services, August 24 and 25 would be observed as gazetted holidays in government offices, boards, corporations, and banks in Sectors 4, 5 and 6 of Panchkula only.
According to officials, interviews to be conducted by the state's service selection board on August 24 and 25 have been rescheduled.
In Punjab, all schools and colleges have been ordered to remain shut on Friday.
A complete ban has been issued on carrying of firearms, with orders to shut down private gun houses selling arms and ammunition to license holders, a spokesperson said after a meeting convened by Chief Minister Amarinder Singh this evening to review the state's security arrangements.
State-owned Punjab Roadways will not run its buses towards Sirsa, where the headquarter of Dera is located, from tomorrow, while PRTC will stop plying of buses towards Haryana on Friday.
The Haryana Roadways too have decided to suspend its bus service to Chandigarh and Panchkula depots for two days from tomorrow, a spokesperson of the transport department said.
To keep a close vigil on law and order situation, security agencies in the two states and their joint capital Chandigarh will resort to videography and aerial surveillance using drones, officials said.
The Haryana government is also keeping a close eye on social media to prevent spread of rumours and Ram Niwas said the DCs and the SPs have been given the authority to monitor social media wherever required.
Meanwhile, Dera Sacha Sauda sect head Gurmeet Ram Rahim took to Twitter to give a message of "selfless service and meditation" to his followers.
"Selfless service, meditation and firm belief are the ornaments in spirituality," he said in a tweet and also shared a link to a Facebook video of one of his discourses.
Akal Takht Jathedar Giani Gurbachan Singh, in Amritsar, asked Amarinder Singh to ensure law and order in Punjab.
He also asked members of the Sikh community to maintain peace and harmony and keep strict vigil on all Gurdwaras round the clock to protect those from anti-social elements, who may take advantage of the situation.
Amid reports that the Dera followers could stock petrol, 'lathis' and other weapons at 'naam charcha ghars', Punjab Police have asked all its top ranking police officials to stay alert.
Various hotels and guest houses in tricity area of the two states comprising Panchkula, Chandigarh and Mohali are being checked by the security personnel.
Heavy police has been deployed in Bathinda, which shares its border with Sirsa -- the Dera headquarters in Haryana.
The Dera head has had a run-in in the past with Sikh radicals who had accused him of having allegedly dressed up as the tenth Sikh master, Guru Gobind Singh, in 2007, following which Punjab had remained on boil for many days.
The case was registered in 2002 by the CBI on the directions of the Punjab and Haryana High Court after anonymous letters were circulated about the alleged sexual exploitation of two 'sadhvis' (female followers) by Gurmeet Ram Rahim Singh.
However, the Dera chief has denied these charges.