Rain began to fall shortly after the last firework had exploded over Lake Wakatipu on Friday night - and barely stopped until 10am on Saturday.
A total of 25.2mm of rain fell on Friday night, most of that between 11pm and 9am. It forced Coronet Peak to close for the day on Saturday, due to a saturated snow pack, which also meant the postponement of the Mountain Bikes on Snow event.
Festival organisers also decided to postpone the hugely popular Birdman competition.
Both events went off without a hitch yesterday, with the Mountain Bikes on Snow competitors making the most of about 10cm of snow which had fallen overnight.
The Birdman was held following yesterday's Day on the Bay event, which included jet sprints, a paddleboard race, the splash and dash and the Undy 500.
However, Saturday's Street Parade continued as planned, with skies clearing just in time to welcome the hundreds of people who lined the CBD to take in the inaugural Golden Mile race before the 25 floats completed the slow circuit of the town centre.
Winner of the Golden Mile was Dunedin's Daniel Balchin, who took first place overall with a time of 4 minutes and 30 seconds.
Competitors raced twice around the main CBD block dressed in everything from proper running attire to business suits and wedding dresses.
Julia Blanchard, of Queenstown, chose a full-length bridal gown as her race ensemble, which she lifted at the front so as not to trip over.
Ms Blanchard told the Queenstown Times she was the "runaway bride", but had been jilted by her groom at the start-line.
The crowds swelled again as the festival street parade began, led this year by the Ice Age 4: Continental Drift float.
The floats, representing both corporate businesses and community groups, included everything from costumed characters, school children and a cow with shoes, to mini jet-boats, rafts and a vintage steam tractor.
Festival director Simon Green was delighted.
"It was great to see such strong representation from local businesses, and the Ice Age 4 characters Sid and Scrat were an absolute hit with the kids."
Queenstown Preschool was awarded the prize for best community float for its Manny and the Hunters creation, by Queenstown Lakes District Council arts and events facilitator Jan Maxwell.
Queenstown Primary School's Ice Age bus float came second.
Meanwhile, Shotover Jet and Southern Discoveries will have to share the coveted business section Ngai Tahu trophy after they were announced joint winners.
Each business will for six months have the hand-carved wooden trophy which represents the Maori warrior Matakauri from the local legend of Lake Wakatipu.
On Saturday night, hundreds braved the rain to watch Sid and Scrat strut down the blue carpet ahead of the Ice Age 4: Continental Drift New Zealand premiere at Reading Cinemas, while many adults opted to attend the sold-out Comedy Gala at the Queenstown Memorial Hall instead of watching the All Blacks decimate Ireland in the third and final rugby test in Hamilton.
Yesterday afternoon, thousands of people crowded around the waterfront to take in the Day on the Bay action, culminating in the highly popular Birdman.
The bravest of the brave launched themselves from a jetty into the freezing waters of Lake Wakatipu to the delight of the crowd.
They included TVNZ weatherman Sam Wallace, sponsored by MetService, who attached large helium balloons to himself in the hopes of gaining some air - the balloons detached from his overpants and floated off into the horizon.
The best individual entrant was the 2011 overall winners Flight of the Conchords - the Orange Men who performed a choreographed routine to It's Business Time and Single Ladies.
But the overall winner this year was the "Pack and Send" team, who dressed as The Wiggles, complete with the Big Red Car, winning four VIP tickets to last night's sold out Flight of the Conchords show at the Queenstown Events Centre.
