The Bureau of Meteorology says a tropical low in the Gulf of Carpentaria could form into a cyclone as soon as Friday night — but it's expected to bypass the NT coast.
While the cyclone, to be named Savannah, may miss the Top End, it could bring relief to the parched Barkly region of the Territory.
A cyclone watch was issued for Queensland communities along the eastern shores of the Gulf, with gale-force winds expected from Weipa, south to Burketown.
Forecaster Jackson Browne said it was in the eastern Gulf that the system was likely to stay.
"It's likely to hug the western coast of Cape York Peninsula and just head down south into the interior," Mr Browne said.
"It could possibly form into a (category one) cyclone tomorrow, or early into Saturday."
The system is currently 135 kilometres northwest of Weipa, and moving relatively slowly south, at nine kilometres an hour.
Flood watch for FNQ
The bureau said heavy rainfall and possible flash flooding was expected to develop across Cape York Peninsula and spread slowly southwards, and a flood watch was in place for much of Far North Queensland.
On the NT side of the Gulf, a strong wind warning was in place for the Gove Peninsula coast and would be extended to the entire Gulf coast by tomorrow.
Mr Browne said the system would suck moist air away from the Darwin area.
"It's probably already showing itself in Darwin, because the monsoon trough extends from this system across to [Darwin]," he said.
"It's a major focus for the monsoon trough, so it's already acting to draw a lot of the moisture away from us, and into it."
However, the weakening monsoon trough was still expected to deliver 50-100mm of rain over the next three days.
Hope of relief for parched Barkly
The bureau forecasted the system would cross the coast between Normanton and Burketown on Sunday, dumping much-needed rain across the Gulf country, before bringing a cool change to the heatwave-affected Barkly Tablelands.
The Barkly, including the outback town of Tennant Creek, reached a record last month for its most days in a row above 40C.
Further west, Tropical Cyclone Riley was sitting 280 kilometres west north-west of Broome in the Indian Ocean.
It was expected to strengthen to a category three system, but drift further out to sea later in the week.ABC