A 12-inch water main ruptured in the 700 block of Durham Road, the town reported Wednesday morning.
Officials said the break occurred in new pipe that was installed Tuesday.
Crews from the Raleigh utilities department are making repairs, and service is expected to be restored by 7 a.m., town spokesman Bill Crabtree said in a news release.
Durham Road from Capital Boulevard to Tyler Run Drive has been reduced to one lane with alternating two-way traffic.
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Residents who live near the 700 block of Durham Road, along with neighbors on Magnolia Forest Court, Oakwood Estates, Hope Street and Richland Drive, have no water service.