The lake, in the crater of Mount Pinatubo, has filled with rainwater since it was created in an eruption 10 years ago.
Scientists fear that unless they empty it in a controlled manner, it could breach the volcano's rim and flood the surrounding area.
Click here to see drainage plan
Raymundo Punongbayan, director of the Philippine Institute
for Volcanology and Seismology, said a five-metre-wide (16 feet) channel had been dug from the crater's edge.
Mr Punongbayan said there was still a 20% chance of the operation going wrong.
In this scenario, a surge of water could collect mud and bury villages in several metres of debris.
"That's why we want people to evacuate," Mr Punongbayan said.
Geologists believe the lake that has formed in the crater could release as much as 60 million cubic metres of water (13 billion gallons).
The problem has its roots in Mount Pinatubo's 1991 eruption, when 800 people were killed.
The volcano's top was blown off during the eruption, leaving a hole covering five square km (two square miles).
Despite government warnings about the evacuation, not everyone intends to leave.
Faustino Corum, a retired government assessor, told Reuters news agency he was staying put.
"I will be able to see the waters coming even if they are still kilometres away. That will give me enough time to run," he was quoted as saying.
A "plug" of earth has been left in place, ready to be dislodged when the order to drain the lake is given, expected on Thursday morning.
If the operation goes according to plan, 24 million cubic metres (five billion gallons) will be drained off in the first 24 hours.
Related to this story:
Volcano disaster warning
(25 Jul 01 | Sci/Tech)
Volcanic lake threatens disaster
(16 Aug 01 | Asia-Pacific)
Early warning for volcanic mudslides
(31 Jan 01 | Sci/Tech)
Satellite snaps volcano eruption
(08 Jun 01 | Sci/Tech)
Thousands flee Philippines volcano
(24 Jun 01 | Asia-Pacific)
Internet links:
Philippine Institute of Volcanology and Seismology |
Oxfam |
About Pinatubo |
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