The storm was stripped of hurricane status just before daybreak, but the crisis set off by more than a foot of rain was far from over.
"As the sun shines in North Carolina and blue sky returns, our state is facing major destruction and, sadly, death," Gov. Pat McCrory said as the effects of the deluge became clearer at daylight.
Rivers and creeks overflowed, driving people from their homes and trapping others as much as 100 miles inland.
The unofficial rainfall totals were staggering: 18 inches in Wilmington, 14 inches in Fayetteville and 8 inches in Raleigh.
Shortly before daybreak, the hurricane was downgraded to a post-tropical cyclone. As of 8 am EDT, the storm was centered about 60 miles southeast of Cape Hatteras, North Carolina, moving out to sea. It still had hurricane-force winds of 75 mph.
Forecasters said North Carolina and Virginia could get even more rain and warned of the danger of life-threatening flooding through Monday night.
Matthew also killed more than 500 people in Haiti last week as it plowed through the Caribbean.
Other places to the south of the Carolinas, meanwhile, began getting back to normal, with millions relieved that the storm wasn't the catastrophe that many had been bracing for.
In many places, the damage consisted mostly of flooded streets, blown-down signs and awnings, flattened trees and power outages.
As the skies cleared on Saturday, people started cleaning up, reopening their businesses or hitting the beach.
The power started coming back on. And all three major theme parks in Orlando, Florida, including Walt Disney World, were up and running.
Along Daytona Beach's main drag, the Silver Diner had all of its shiny metal siding ripped off the front and sides, leaving only a wood frame exposed. Next door, the window of a souvenir shop had been blown out and the roof and ceiling torn through, leaving pink insulation dangling.
David Beasley, president of Insurance Recovery Inc, surveyed the damage and said that although it looked bad, the main strip was hit harder by Hurricanes Charley and Frances in 2004.
"This is not much compared to those two," he said. On Saturday, Matthew sideswiped two of the South's oldest and most historic cities Savannah, Georgia, and Charleston, South Carolina and also brought torrential rain and stiff wind to places like Myrtle Beach, South Carolina.
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