Last updated 8:30 p.m. Eastern
Karl reached hurricane force in the Gulf of Mexico on Thursday and was expected to strengthen more before hitting Mexico's coast near a port and an oil hub on Friday.
The U.S. National Hurricane Center in Miami, Florida, said there was a possibility that Karl could become a major hurricane with winds of 110 mph or higher before making landfall.
The Mexican government issued a hurricane warning for a 150-mile stretch of coast in Veracruz state. On its predicted path, Karl could make landfall near the coastal city of Tuxpan and the oil hub of Poza Rica.
Authorities in Veracruz whose southern half has suffered severe flooding over the past few weeks braced for a hit on its northern coast, preparing sleeping mats, bottled water and other supplies for anyone taking refuge in shelters. Workers in Veracruz city cut dangerous tree limbs that could become flying debris.
In the beach town of Tecolutla, just south of Poza Rica, fishermen and operators of small tour boats were pulling their craft out of the water.
Some residents were boarding up their windows with sheets of plywood, lashing down cooking gas tanks and reinforcing doors and signs to prevent them from being blow away by the hurricane's wind, said town civil defense director Edilberto Peralta.
"We are getting ready and warning people early, to avoid any loss of human life," said Peralta, whose town of about 25,000 was lashed by Hurricane Dean in 2007 and severely flooded by a tropical depression in 1999. "We are ready to take drastic measures."
"We are hearing it may hit as a Category two or Category three on Friday, so we'll have to see whether we evacuate people tonight, or tomorrow," said Peralta.
The port of Tuxpan was closed to small craft Thursday, and Port Capt. Gaspar Cime said larger vessels would be banned later in the day. Tuxpan has about 135,000 people.
By Thursday afternoon, Karl was centered 280 miles east-southeast of Tuxpan, with winds of 75 mph. It was moving westward rapidly at about 12 mph.
In the Atlantic, Hurricane Igor spun into a Category 4 storm that could generate dangerous rip currents along the U.S. East Coast over the weekend and bring large swells to the Bahamas and Virgin Islands before that. Category 2 Hurricane Julia was not a threat to land.
Karl could cause storm surges of 6 to 9 feet and "large and destructive waves," as well as dump up to 15 inches of rain in some areas of Veracruz state, the Hurricane Center said in a statement.
Poza Rica, while slightly inland, houses important pipelines and natural gas- and oil-processing plants operated by the state-owned oil company, Petroleos Mexicanos. Pemex said it had no immediate plans to halt production at the plants because of the storm.
About 80,000 people have had their homes damaged and nine people have been killed in flooding from heavy rains in southern Veracruz since Aug. 19. Officials expressed concern Karl could raise river levels again, just as some residents are thinking of returning to their homes.
As a tropical storm, Karl hit Yucatan on Wednesday, downing tree limbs and causing power outages. The storm made landfall on the Mexican Caribbean coast about midway between the cruise ship port of Majahual and the coastal town of Xcalak.
Violeta Pineda, who has operated the Hotel Kabah Na's thatched-roof bungalows for 13 years, said waves were rolling about 25 yards onto the beach and eating away at a stretch of road that runs along the coast.
Electricity went out briefly around Majahual, which in 2007 took a near-direct hit from Category 5 Hurricane Dean, the third-most powerful Atlantic hurricane ever to hit land.
"This is nothing in comparison," Pineda said.
Farther to the east in the Atlantic, Hurricane Julia briefly intensified into a powerful Category 4 storm Wednesday before weakening to Category 2 early Thursday. Julia had maximum sustained winds near 100 mph. Hurricane Igor's top winds reached 140 mph on a track that could take it over Bermuda by Monday.