* Downgraded to Category 3 from 4
* Passes over Florida Keys, heads towards Naples
* Streets of Miami flooded
* About 2 million homes, businesses without power
* First U.S. death linked to storm
FORT MYERS/MIAMI Sept 10 (Reuters) - Hurricane Irma lost some strength as it pounded southern Florida on Sunday afternoon, but forecasts warned it would remain a powerful storm as it flooded Miami streets and knocked out power to about 2 million homes and businesses.
All of southern Florida was feeling the effects of the storm creeping towards the shore, with at least one man killed, a woman forced to deliver her own baby, apartment towers swaying in high winds and trees uprooted.
The National Hurricane Center said the storm had maximum sustained winds of 120 miles per hour (195 kph), dropping it to a Category 3, the midpoint of the five-step Saffir-Simpson scale.
Tampa and Hurricane Bays saw extraordinarily low tides, with sea life visible and boats grounded, though forecasters warned the storm would soon drive those waters back in with storm surges of up to 15 feet(4.6 m) along the state's western Gulf Coast.
Small whitecapped waves could be seen in flooded streets between Miami office towers.
Irma had been one of the most powerful hurricanes ever seen in the Atlantic, killing 28 people in the Caribbean and pummeling Cuba with 36-foot (11 meter) waves on Sunday. Its core was located about 30 miles (48 km) south of Naples by 2 p.m. ET (1800 GMT) and was expected to move along or over Florida's western coast through the afternoon and evening.
Some 6.5 million people, about a third of the state's population, had been ordered to evacuate southern Florida.
"This is a life-threatening situation," Governor Rick Scott told a press conference.
Tornadoes were also spotted through the region.
Irma is expected to cause billions of dollars in damage to the third-most-populous U.S. state, a major tourism hub with an economy that generates about 5 percent of U.S. gross domestic product.
About 2 million Florida homes and businesses had lost power, according to Florida Power & Light and other utilities.
The storm killed 24 as it raged through the Caribbean. It has already claimed at least one life in Florida, a man found dead in his pickup truck, which had crashed into a tree in high winds.
MIAMI BUILDINGS SWAY, STREETS FLOODED
The storm winds downed at least one construction crane and shook tall buildings in Miami, which was about 100 miles (160 km) from Irma's core.
Deme Lomas, who owns Miami restaurant Niu Kitchen, said he saw a crane torn apart by winds and dangling from the top of a building.
"We feel the building swaying all the time," Lomas said in a phone interview from his 35th-floor apartment. "It's like being on a ship."
Waves poured over a Miami seawall, flooding streets waist-deep in places around Brickell Avenue which runs a couple of blocks from the waterfront through the financial district and past consulates. High rise apartment buildings were left standing like islands in the flood.
One woman in Miami's Little Haiti neighborhood delivered her own baby because emergency responders were not able to reach her, the city of Miami said on Twitter. The two are now at the hospital, it said.
On Marco Island, right in Irma's path just south of Naples, 67-year-old Kathleen Turner and her husband were riding out the storm on the second floor of a friend's condominium after failing to find a flight out. She feared for her canal-facing home.
"I'm feeling better than being in my house, but I'm worried about my home, about whats going to happen," Turner said.
Irma comes just days after Hurricane Harvey dumped record-setting rain in Texas, causing unprecedented flooding, killing at least 60 people and an estimated $180 billion in property damage. Almost three months remain in the Atlantic hurricane season, which runs through November.
U.S. President Donald Trump spoke to the governors of Alabama, Georgia, South Carolina and Tennessee on Sunday and issued a disaster declaration for Puerto Rico, which was hit by the storm last week, the White House said.
(Additional reporting by Sarah Marsh in Remedios, Marc Frank in Havana, Bernie Woodall, Ben Gruber and Andy Sullivan in Miami, Colleen Jenkins in Winston-Salem, North Carolina, Doina Chiacu and Roberta Rampton in Washington and Scott DiSavino in New York; Writing by Scott Malone; Editing by Ross Colvin and Andrew Hay)