The Environment Agency Wales has said £5m of defences in New Tredegar prevented serious flooding last month.
The flood defence scheme was officially opened last year by Jane Davidson AM, Minister for Environment, Sustainability and Housing.
The scheme protects 38 properties in the town, including a local care home and leisure centre, from flooding from the River Rhymney.
According the to the Environment Agency Wales, on October 1 this year, heavy rain swelled the river which would have overcome the old flood defence.
Graham Hillier, Environment Agency Wales area manager for the south east, said: “New Tredegar has a long history of flooding with local homes and businesses affected.
“The new defence provides the local community with an improved level of protection against flooding from the River Rhymney. Over the last month we have seen how well the defences can withstand floods.”
Wayne Emery, of United Welsh housing association, said: “The improvements carried out have brought peace of mind to the elderly residents in our nearby sheltered scheme at Glan yr Afon. These residents have previously been evacuated, or threatened with evacuation on at least a couple of occasions.”
The New Tredegar Flood Alleviation Scheme was funded by European Regional Development Funding, the Welsh Assembly Government and Caerphilly County Borough Council.
The scheme’s design involved raising the Birchgrove Bridge to help the river to flow freely during heavy rain. Raised flood embankments and walls were also constructed to reduce flood water spills and provide increased protection to local buildings including the local leisure centre.