Emergency crews are on the scene working to repair the problem, officials said, and the water was shut off around 8 a.m.
It likely will take days to complete work and restore streets, said Vincent Sapienza, Commissioner of the Department of Environmental Protection.
Transit authorities were assessing damage and working to restore service late Monday morning. Officials said they expect things will return to normal by the evening rush hour.
Three buildings reported significant damage, Fire Department of New York Deputy Assistant Chief Joseph Ferrante said.
Residents also reported tea-colored water coming out of their faucets.
Sapienza said there are no concerns about water quality and residents should let the water run until clear.