Queensland Ambulance Service says two women in their 30s and a man in his 20s were driving on the Mulligan Hwy at Desailly, northwest of Cairns, when their vehicle was swamped about 1.30am on Tuesday.

The three managed to exit the vehicle and were found clinging to a tree, before they were transported to Mareeba Hospital. All three were in a stable condition.

Tiffany was a category two cyclone packing winds of up to 130km/h when it crossed the east coast of the Cape York Peninsula on Monday afternoon.

It weakened to a tropical low over land with the Bureau of Meteorology warning up to 200mm of rainfall could be dumped on the region as the system moves west on Tuesday.

It is then likely to reform into a category two cyclone over the Gulf of Carpentaria, with a warning issued for communities in the Northern Territory's east.

The alert extends from Nhulunbuy, about 650km east of Darwin, to the Queensland border, and includes Groote Eylandt, Numbulwar, Port Roper, and Port McArthur.

The system is predicted to hit the island of Groote Eylandt in the gulf on Wednesday with gales up to 140km/h.

People in coastal areas between Cape Shield and Nathan River are being warned to prepare for destructive winds.

The bureau said communities as far west as Barunga and Mataranka, 420km southeast of Darwin, may experience gales of up to 100km/h with heavy rain expected to cause flooding across the Arnhem and Carpentaria districts as the cyclone moves inland.

A flood watch remains current for 16 North Queensland rivers and Cape York's major land transport route, the Peninsula Development Rd, was likely to be shut.

"Riverine and localised flooding is likely, causing disruption to transport routes and isolation of some communities," the bureau said in a statement.

Australian Associated Press