A sinkhole has swallowed cars and three houses have been flooded after a water main burst at Port Melbourne.

Water gushed down the road on Liardet Street in the early hours of the morning, until water workers turned off the supply.

Residents were forced to move their cars after the burst main began flooding the street. ( ABC News )

Resident Chris Browne said his house was one of those affected.

"We were awoken by chatting in the street. We looked at the time and it was three o'clock," he said.

"Police knocked on the door then and we were flooded."

Locals had to move their cars as water levels began spilling over the gutter on some parts of the road.

"It was a bit of excitement for the area that's for sure," Mr Browne said.