BRATTLEBORO, Vt. (Reuters) - Vermont residents battled epic flooding Monday after the remnants of Hurricane Irene set off the state's worst deluge in more than 80 years, washing out roads, knocking out power and forcing hundreds into shelters.

At least one person was killed after being swept into a swollen river in the mountainous, land-locked New England state, which rarely sees tropical storms.

Hurricane Irene had been reduced to tropical storm status by the time it reached Vermont but it still dumped 7 inches of rain that flooded homes and businesses. Floodwaters gushed through downtown Brattleboro, an artsy community of 12,000 along the Connecticut River.

Several of the state's historic covered bridges were washed away as Irene's rains sent rivers spilling over their banks in what officials called catastrophic flooding and the worst natural disaster since 1927.

While the sun was out on Monday, officials worried that more damage could still be done. "The bigger rivers haven't crested yet because the smaller brooks feed into them," Governor Peter Shumlin said in a radio interview with Democracy Now, a daily TV/radio news program. "It means more flooding. We continue to be challenged here."

Several people had to be rescued from floodwaters and some 50,000 people are without power. Some patients at the Vermont State Hospital had to be moved within the grounds and 80 people from a nearby nursing home were evacuated to Rutland Regional Medical Center, a spokesman said. The governor and others were surveying the vast damage by helicopter, officials said.

In Woodstock, called America's prettiest small town by Ladies Home Journal, a water main break left the town without water coming from faucets and toilets but with plenty gushing through the streets, including through the bottom of the Woodstock Inn. The Simon Pearce glass blowing studio in Quechee, which draws power from the Ottaquechee River, was flooded and the historic bridge leading to the studio, store and restaurant was teetering, a staff member said.

"It is complete mayhem up here," a spokesman at the Woodstock police department said.

State offices, businesses and many schools were closed on Monday as officials urged Vermont residents to stay indoors and off the roads as emergency crews approach the worst hit areas in Rutland and Addison counties in the south and middle of the state.

Weather reporters said the flooding was the worst in Vermont since 1973 and perhaps since 1927.

Hurricane Irene chugged up the eastern seaboard Saturday and Sunday, starting in North Carolina, and appears to have inflicted the greatest damage farther inland with heavy rains in western Massachusetts and Vermont.

Overnight every road in Vermont -- except interstate highways Routes 89 and 91 -- was closed at one one point due to flooding, Robert Stirewalt, a spokesman for the Vermont Emergency Management Agency said Monday.

"Things are bad throughout the state and we are just starting the recovery process in the light of day," he said. "It is too early to say what the damage will be as we assess it and we hope it won't be more extensive than last night indicated."

On Sunday and overnight nine Red Cross shelters and 27 community shelters opened their doors to aid the state's roughly 625,000 citizens and by Monday officials said they were filling up fast with people whose homes were waterlogged.

Known for its many rivers and creeks, Vermont had swift water rescue teams ready to move and every single emergency worker in the small state was called up to help, officials said.

But even some of the helpers encountered terrifying conditions and had to turn back on some occasions, officials said. The state Emergency Management Office in Waterbury was forced out to evacuate its building overnight and move in with a the Federal Emergency Management Agency in a nearby building. (Additional reporting by Toni Clarke and Lauren Keiper; Editing by Bill Trott)