Rescuers in Nepal used helicopters to search for survivors and drop emergency supplies to thousands cut off in towns and valleys after Wednesday's disaster swept a road thronged by trekkers and pilgrims that links Kathmandu with Lhasa in Tibet.

Police said they expected the death toll to rise beyond 165.

'This will go up, as we have resumed the search and more bodies are expected to be recovered,' police spokesperson Abi Narayan Kafle told Reuters.

Almost 500 foreigners were among 826 people missing in Nepal, police and tourism officials said.

Among the missing tourists from more than two dozen countries, 177 were from India, 63 were from the United States, 34 from Australia, 33 from Britain and 25 from Canada.

The Kathmandu Post has reported that the floods were caused after an avalanche blocked the flow of the Lhende tributary of the Bhotekoshi and first hit Timure, near Nepal 's border with China at Rasuwagadhi.

The German Research Centre for Geosciences said there was a 4.4-magnitude quake approximately seven minutes before the time shown on the security footage time-stamp.

Much of the settlement, home to hundreds of people, was swept away before the flood surged downstream. The reported added that with no rainfall reported in the area, residents had no warning of the disaster and were going about their daily routines when the flood struck.

Malaysia's foreign ministry said 55 nationals were uncontactable, but there was no official confirmation of casualties.

The tally of missing in Tibet's Gyirong county was 558, Chinese state broadcaster CCTV said on Thursday, including 260 foreign nationals. China said the death toll stayed at three.

Verified videos showed crushing masses of water and debris sweeping away dozens of people at a border crossing in Gyirong, with homes, roads and power projects washed away in Nepal as the flows travelled downstream.

'It was a huge gush of mud coming straight towards us,' said Keshav Prasad Baral, a 68-year-old survivor being treated in a Nepali hospital.

'As it got closer, it kept rising higher and higher. When I saw it enter our home, I tried to grab my wife's hand and take her to the terrace. But she was swept away by the mud.'

A helicopter ferried him to safety four hours later. 'My wife is still somewhere beneath the mud,' he added. 'She's gone.'

Another survivor said he saved himself by clinging to a mango tree as he watched the house where he had been working disappear.

In the hardest-hit districts, helicopters are dropping tents, food and other emergency supplies provided by neighbouring India, said Raja Ram Basnet, a spokesperson for Nepal's army.

More than 5,000 army and police rescue personnel joined the rescue effort that retrieved 125 people on Thursday, including 20 foreigners, he said.

Nepal's Prime Minister Balendra Shah left by road to assess the flood situation in Nuwakot, one of the worst-affected districts, his office said on social media.

Early reports from Nepali officials suggested an earthquake in the area could have caused the lower part of a glacier to collapse and trigger the floods.

Chinese authorities have identified risks from a still-dammed lake in Gyirong, upstream from the mudslide and flood-stricken Tibet-Nepal border crossing that could complicate rescue efforts, particularly as rains are forecast, CCTV said.

Last July, the rapid drainage of a lake atop the Purepa glacier in Tibet unleashed deadly floods in Nepal.

Many of this week's victims were pilgrims headed to Kailash Mansarovar, a high-altitude site in Tibet revered by Hindus and Buddhists, among others.

Mount Kailash, which Hindus believe to be the abode of Lord Shiva, lies on the banks of Lake Mansarovar, is also held sacred by many.

Sagar Pandey, the chief executive of a Himalayan tourism operator, said 15 Indian-Australians on a pilgrimage tour with the company were missing.

'There are no human-made things, no human settlement left. Everything is just flat,' he told Reuters after flying over the zone in a helicopter. 'So anyone in the hotel, the restaurant, or the car, I believe that everybody is gone.'

(with inputs from Reuters)