Flood estimation is often required in hydrologic design and has important economic significance. For example, in Australia, the annual spending on infrastructure requiring flood estimation is of the order of $650 million ARR (I.E. Aust., 1998). Rainfall-based flood estimation techniques are most commonly adopted in practice. These require several inputs to convert design rainfalls to design floods. Of all the inputs, loss is an important one and defined as the amount of precipitation that does not appear as direct runoff. The concept of loss includes moisture intercepted by vegetation, infiltration into the soil, retention on the surface, evaporation and loss through the streambed and banks. As these loss components are dependent on topography, soils, vegetation and climate, the loss exhibits a high degree of temporal and spatial variability during the rainfall event. In design flood estimation, the simplified lumped conceptual loss models were used because of their simplicity and ability to approximate catchment runoff behaviour. In Australia, the most commonly adopted conceptual loss model is the initial losscontinuing loss model. For a specific part of the catchment, the initial loss occurs prior to the commencement of surface runoff, and can be considered to be composed of the interception loss, depression storage and infiltration that occur before the soil surface saturates. ARR (I. E. Aust., 1998) mentioned that the continuing loss is the average rate of loss throughout the remainder of the storm. At present, there is inadequate information on design losses in most parts of Australia and this is one of the greatest weaknesses in Australian flood hydrology. Currently recommended design losses are not compatible with design rainfall information in Australian Rainfall and Runoff. Also design losses for observed storms show a wide variability and it is always difficult to select an appropriate value of loss from this wide range for a particular application. Despite the wide variability of loss values, in the widely used Design Event Approach, a single value of initial and continuing losses is adopted. Because of the non-linearity in the rainfall-runoff process, this is likely to introduce a high degree of uncertainty and possible bias in the resulting flood estimates. In contrast, the Joint Probability Approach can consider probability-distributed losses in flood estimation. In ARR (I. E. Aust., 1998) it is recommended to use a constant continuing loss value in rainfall events. In this research it was observed that the continuing loss values in the rainfall events were not constant, rather than it decays with the duration of the rainfall event. The derived loss values from the 969 rainfall and streamflow events of Queensland catchments would provide better flood estimation than the recommended design loss values in ARR (I. E. Aust., 1998). In this research, both the initial and continuing losses were computed using IL-CL loss model and a single median loss value was used to estimate flood using Design Event Approach. Again both the initial and continuing losses were considered to be random variables and their probability distribution functions were determined. Hence, the research showed that the probability distributed loss values can be used for Queensland catchments in near future for better flood estimate. The research hypothesis tested was whether the new loss value for Queensland catchments provides significant improvement in design flood estimation. A total of 48 catchments, 82 pluviograph stations and 24 daily rainfall stations were selected from all over Queensland to test the research hypothesis. The research improved the recommended design loss values that will result in more precise design flood estimates. This will ultimately save millions of dollars in the construction of hydraulic infrastructures.