A breach of the dam's spillway early in the morning sent floodwaters pouring into the township of Swar and nearby villages, the Reuters news agency said.
"We have just come back" from the breach zone, a spokesperson from the Department of Disaster Relief and Resettlement told CNN. "It is OK there now, but many villages were flooded, and a lot of people left their homes."
Local authorities urged residents to evacuate as the flooding might get worse.
The commander-in-chief of Myanmar's armed forces, Min Aung Hlaing, posted pictures Wednesday of himself at the dam site using the Russian social network VK. Facebook on Monday announced it was removing his account, along with other government and civilian pages in connection with ethnic violence against Rohingya Muslims.
Commuters between Mandalay, in central Myanmar, and Yangon reported highway closures because of the flooding.
A bridge on a major highway linking Myanmar's major cities of Yangon, Mandalay and the capital, Naypyitaw, was damaged by the floods, Reuters reported. The floodwaters have also caused damage to railroads, halting some train services.
Heavy annual monsoon rains have already brought flooding to other parts of the country and the region.
A dam in neighboring Laos collapsed last month, causing flash-flooding across six villages and displacing thousands of people.
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