Videos posted online showed some streets flooded and the sky being full of black clouds, darkening the city.
Footage also showed heavy hail hitting the shrine of Imam Reza (PBUH) with pilgrims rushing to the yard of the holy site to rescue doves trapped under the hailstones.
Reports say a thick fog is now hanging over Mashhad and the rain is overflowing from the streets into residential buildings.
A local official says the recent downpours in Mashhad have been unprecedented in 200 years.
Rescue workers have been deployed in their thousands to areas prone to flooding.
Heavy flooding on Thursday killed at least 12 people in Mahshad and caused huge material damage.
Many cars were destroyed and washed away in the flooding while a number of people remain missing.
