* Storm downgraded to Category 2 hurricane
* Intense storm surges, inland flooding still expected
* 10 million people in potential disaster zone (Recasts with further weakening of winds; storm downgraded to Category 2)
WILMINGTON, N.C., Sept 12 (Reuters) - Hurricane Florence, growing in size despite its weakening winds on Wednesday, crept closer to the U.S. East Coast as disaster mobilizations expanded south from the Carolinas into Georgia to counter the threat of deadly high seas and calamitous floods.
The center of Florence, no longer classified as a major hurricane but still posing a grave threat to life and property, is expected to strike North Carolina's southern coast on Friday, then drift southwest along the shoreline before moving inland on Saturday, according to the National Hurricane Center in Miami.
The storm's maximum sustained winds were clocked late on Wednesday night at 110 miles per hour (175 km per hour), down from a peak of 140 mph a day earlier, before Florence was downgraded to a Category 3, then a Category 2, on the five-step Saffir-Simpson scale of wind strength.
"While Florence has weakened below major hurricane intensity, the wind field of the hurricane continues to grow in size," the NHC said in its latest bulletin.
A long stretch of the U.S. Eastern Seaboard remained vulnerable to hurricane and tropical storm conditions, from Georgia north through the Carolinas into Virginia. And Florence remained capable of unleashing rain-fueled catastrophic flooding of rivers and low-lying areas across a wide region.
"The time to prepare is almost over," North Carolina Governor Roy Cooper told a morning news conference. "Disaster is at the doorstep and it's coming in."
Besides inundating the coast with wind-driven storm surges of seawater as high as 13 feet (4 meters) along the Carolina coast, Florence could dump 20 to 30 inches (51-76 cm) of rain, with up to 40 inches in parts of North Carolina, the NHC said.
Downpours and flooding would be especially severe, lasting for days, if the storm stalls over land. Heavy rains were forecast to extend into the Appalachians, affecting parts of Alabama, Tennessee, Kentucky and West Virginia.
Tens of thousands of homes and businesses could be flooded in North Carolina alone, Governor Cooper warned.
Georgia Governor Nathan Deal, concerned the storm would bring devastation south, issued an emergency declaration for all 159 counties in his state. Similar declarations were made earlier in North and South Carolina, Virginia, Maryland and the District of Columbia.
More than 1 million have been ordered to evacuate the coastlines of the Carolinas and Virginia.
MILLIONS IN HARM'S WAY
An estimated 10 million people live in areas expected to be placed under a hurricane or storm advisory, said Marc Chenard of the U.S. Weather Prediction Center.
The first tropical storm-force winds were forecast to hit the coast on Thursday.
Emergency preparations in the region included activating over 2,700 National Guard troops, stockpiling food, setting up shelters, switching traffic patterns so major roads led away from shore, and securing 16 nuclear power reactors in the Carolinas and Virginia.
Utility officials have warned that widespread power outages are likely and that it could take weeks to restore electricity.
Wilmington, North Carolina, just north of where Florence appeared headed for shore, grew empty and quiet on Wednesday.
"I'm not approaching Florence from fear or panic," said Brad Corpening, 35, who planned to ride out the storm in his boarded-up delicatessen in Wilmington. "It's going to happen. We just need to figure out how to make it through."
Officials in New Hanover County, which includes Wilmington, have stockpiled enough food and water for 60,000 people for four days, along with more than 28,000 tarps. Shelters in the city were filling and some people were being bused inland to Raleigh, even though some residents there were told they might have to evacuate because of flooding.
"It's going to be bad," said Woody White, a county commissioner. "But no matter how bad it's going to be, it will pass and our job will be to rebuild this community together."
(Reporting by Ernest Scheyder Additional reporting by Scott DiSavino in New York, Brendan O'Brien in Milwaukee and Bernie Woodall in Fort Lauderdale, Florida; and Gene Cherry in Raleigh, North Carolina and Alex Dobuzinskis in Los Angeles; Writing by Bill Trott and Steve Gorman; Editing by Bill Tarrant and Lisa Shumaker)