About 150,000 people will leave their homes on the slopes of Mount Agung, Bali's governor says, while the island's main airport will close for another 24 hours due to ashfall.
Governor Made Pastika said the evacuation period for people living within 10km of the crater could easily last as long as a month.
Indonesia's disaster management agency said the evacuation had so far been orderly and without panic.
Mount Agung has been hurling clouds of white and dark grey ash about 3000m into the atmosphere since the weekend and lava is welling up in the crater, sometimes reflected as a reddish-yellow glow in the ash plumes.
Its explosions can be heard about 12km away.
Videos released by Indonesia's disaster management agency showed a mudflow of volcanic debris and water - known as a lahar - moving down the volcano's slopes.
It said lahars could increase because it is rainy season. The agency warned people to stay away from rivers.
Indonesia's Volcanology and Geological Disaster Mitigation Centre (PVMBG), which is using drones, satellite imagery and other equipment, said predictions were difficult in the absence of instrumental recordings from the last eruption 54 years ago.
It warned that if a similar eruption occurred, it could send rocks bigger than fist-size up to 8km from the summit and volcanic gas a distance of 10km within three minutes.
Recordings now show the northeast area of Agung's peak has swollen in recent weeks "indicating there is fairly strong pressure toward the surface", PVMBG said.
The disaster management agency's spokesman Sutopo Purwo Nugroho told a news conference in Jakarta that the danger zone affected 22 villages and about 90,000 to 100,000 people.
He said about 40,000 people had evacuated but others had not left because they felt safe or did not want to abandon their livestock.
"Authorities will comb the area to persuade them," he said.
"If needed we will forcibly evacuate them."
About 25,000 people were already living in evacuation centres after an increase in tremors from the mountain in September sparked an evacuation.
Lava rising in the crater "will certainly spill over to the slopes," Mr Sutopo said.
Flights grounded again
Bali's Ngurah Rai airport will be closed for a further 24 hours, after being closed on Monday morning due to falling volcanic ash.
The airport said it would reassess the situation on Wednesday morning, with flights currently scheduled to resume at 7am.
Spokesman Air Ahsanurrohim said 445 flights were cancelled on Monday, stranding about 59,000 travellers.
Another 30,000 passengers will be unable to leave via plane after today's closure.
The airport's closure is having a disruptive effect on flights around Indonesia and the region.
Bali is a hub airport in Indonesia with many flights transiting there for domestic as well as international destinations.
Planes that would have flown other routes on Monday were stuck on the tarmac in Bali.
New Zealand's Insurance Ombudsman Karen Stevens told RNZ people travelling to Bali would not have their flights covered by travel insurance if they bought insurance after 26 September.
The Ministry of Foreign Affairs and Trade first issued warnings about the volcano on that date, and Ms Stevens said that meant anyone who booked insurance after date would not be covered.
Human Rights Watch Indonesia researcher Andreas Harsono said he was waiting for two hours at Jakarta's terminal 3 for his delayed flight to a domestic destination.
He said other flight delays had been announced at the terminal, which serves national carrier Garuda, and the departure area was filling up with many waiting passengers.
Indonesia's Directorate General of Land Transportation said 100 buses were being deployed to Bali's international airport and to ferry terminals to help travellers stranded by the eruption.
The agency's chief said major ferry crossing points had been advised to prepare for a surge in passengers and vehicles.
About 500 passengers have so far moved on to airports on the island of Java, but most are remaining on Bali and hoping the airport will resume operations.
Indonesia's Tourism Ministry said member hotels of the Indonesia Hotel and Restaurant Association would provide a night's free accommodation to people affected by the airport closure.
Mt Agung's last eruption in 1963 killed more than 1000 people and razed several villages by hurling out pyroclastic material, hot ash, lava and lahar.
- ABC / Reuters / RNZ