© 2020 by the authors. Licensee MDPI, Basel, Switzerland. This study examines an innovative Coastal Reservoir (CR) technique as a feasible solution for flood adaptation and mitigation in the Brisbane River Estuary (BRE), Australia, which is vulnerable to coastal flooding. The study analysed the operation of a CR by using the MIKE 21 hydrodynamic modelling package. The 2D hydrodynamic model was calibrated and validated for the 2013 and 2011 flood events respectively, with a Nash-Sutcliffe coefficient (Ens) between 0.87 to 0.97 at all gauges. River right branch widening and dredging produced a 0.16 m reduction in water level at the Brisbane city gauge. The results show that by suitable gate operation of CR, the 2011 flood normal observed level of 4.46 m, with reference to the Australian Height Datum (AHD) at Brisbane city, could have been reduced to 3.88 m AHD, while under the improved management operation of the Wivenhoe Dam, the flood level could be lowered to 4 m AHD at Brisbane city, which could have been reduced with CR to 2.87 m AHD with an overall water level reduction below the maximum flood level. The results demonstrated that the innovative use of a CR could considerably decrease the overall flood peak and lessen flood severity in the coastal city of Brisbane.