The storm could dump as much as 20 inches of rain on some parts of the islands, said meteorologist Matthew Foster of the Central Pacific Hurricane Center.
Olivia was less than 200 miles (322 kilometers) east of Maui and heading west as it packed winds of 55 mph (90 kph). Maui and Oahu counties appeared most likely to experience the worst impacts, Foster said.
Officials were worried about landslides in west Maui because brush fires during Hurricane Lane three weeks ago wiped out vegetation, Maui County spokesman Rod Antone said.
The owner of the only hardware store in the small town of Hana on the east side of Maui said he was determined to stay open as long as possible to help people prepare.
"If people need to get tarps or screws or anything for their home . I think it's important for us to try to stay open as much as possible, without jeopardizing the well-being of our staff," said Neil Hasegawa, owner of Hasegawa General Store.
The storm was expected to affect Hana starting Tuesday night, and residents were bracing for Hana, with a population of 1,200 people, to take the brunt of the storm, Hasegawa said.
Those who prepared for Hurricane Lane have largely left those preparations in place for Olivia, he said.
"I think they're even taking it more seriously than Lane," Hasegawa said. "You can see the track going ... it's like barreling down on this eastern end."
Hana is a popular day-trip destination for travelers staying in Maui's resort towns. But Hasegawa urged people who don't need to be in Hana to stay away because they could become trapped and take up limited shelter space.
Maui Mayor Alan Arakawa urged residents to store drinking water and warned that they should plan for power outages, landslides, high surf, fallen trees and flooded roads.
Scott Zaffram, a senior response official with the Federal Emergency Management Agency, said emergency teams and supplies were ready on Maui.
The National Guard has mobilized personnel and trucks to the east side of Maui, said Herman Andaya, administrator of the county's emergency management agency.
Maui schools will be closed Wednesday and non-essential county workers will be on administrative leave, Arakawa said.
Public schools on the Big Island, Oahu and Kauai will be open.
Honolulu Mayor Kirk Caldwell said his city's offices will be open as usual. City buses also will be running normally unless winds exceed 40 mph (64 kph).
"We don't want to overreact and tell everyone to stay home when maybe it's not going to be as bad," said Caldwell.
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