The national emergency response agency declared a red alert in Santiago, a city of more than seven million people.
"Unfortunately the weather system over the metropolitan region brought rain that caused increased sediment in the Maipo River, which means a water cut for the population affecting about three million people," Santiago Mayor Claudio Orrego told a news conference.
Production was down to 35 per cent of normal levels, said Eugenio Rodriguez, corporate manager of the Aguas Andinas water company.
Municipal authorities activated an emergency plan that includes tapping into 45 backup water sources and mobilizing more than 60 water trucks.
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Images shared on social media showed bare shelves at supermarkets, where thousands flocked to stock up on bottled water.
In the O'Higgins region 90 kilometers south of Santiago, the swollen Tinguiririca River left one person missing and about 100 homes damaged.
Four municipalities in the region were also on red alert.
Rain was expected to continue throughout the weekend.