The storm, which is currently around 325 miles south east of South Point and 500 miles from Honolulu, has already achieved wind speeds of some 150mph.
Forecasters believe the hurricane, which is moving westward at around 10mph, will turn northerly towards Hawaii on Wednesday (August 22).
High winds, heavy rain and coastal flooding, as well as high surf and rip currents, are forecast for the end of the week.
Eastern areas, Honolulu and Maui counties, are thought be at particular risk, with the storm not forecast to move west again until the weekend.
While landfall is rare, with only four named storms striking the island since 1959, the Central Pacific Hurricane Center has issued a hurricane warning, which means hurricane conditions are expected in watch areas.
The center warns: “Lane is expected to turn toward north west on Wednesday, followed by a turn toward the north-northwest on Thursday.
“On this forecast track, the centre of Lane will move dangerously close to, or over, the main Hawaiian Islands from Thursday through Saturday.
“Although some weakening is expected the next couple of days, Lane is forecast to remain a dangerous hurricane as it draws closer to the Hawaiian Islands.
“The onset of damaging tropical storm force winds on the Big Island could be as early as Wednesday evening, with dangerous hurricane force winds possible by Thursday.”
The four islands of Maui County could experience tropical storm force winds on Wednesday night and hurricane force winds on Thursday.
Oahu island, meanwhile, could face tropical storm force winds on Thursday and hurricane force winds on Thursday night.
The Foreign Office refreshed its Hawaii travel advice during the early hours of Wednesday morning, urging caution.
“The US National Weather Service has declared the state of Hawaii to be under a Hurricane Watch due to the approach of Hurricane Lane,” read the update.
“Please follow the advice of local authorities. For more information, check with the Hawaii Emergency Management Agency and the Central Pacific Hurricane Center.”