We propose a new dynamic simulation scheme for large-scale flood hazard modelling and prevention. The approach consists of a number of core parts: Digital terrain modelling with GIS data, Nona-tree space partitions (NTSP), Automatic River object recognition and registration, and a flood spreading model. The digital terrain modelling method allows the creation of a geometric real terrain model for augmented 3D environments with very large GIS data, and it can also use information gathered from aviation and satellite images with a ROAM algorithm. A spatial image segmentation scheme is described for river and flood identification and for a 3D terrain map of flooding region growth and visualisation. The region merging is then implemented by adopting Flood Region Spreading Algorithm (FRSA). Compared with the conventional methods, our approach has the advantages of being capable of realistically visualising the flooding in geometrically-real 3D environments, of handling dynamic flood behaviour in real-time and of dealing with very large-scale data modelling and visualisation.