Critical issues are investigated regarding the use of Digital Surface Models (DSMs) in flood hazard modelling and assessment. These concern the necessary methodological steps to exploit DSMs for delineating inundated areas as well as the DSM accuracy required. The methodology proposed is comprised of a typical photogrammetric procedure to produce DSM combined with typical hydrological and hydraulic models. The design flood approach is followed in hydrological modelling using the SCS method coupled with a Unit Hydrograph. Hydraulic quantities such as water depth and velocity are assessed through numerically solving the full one-dimensional Saint-Venant equations for unsteady flow conditions in open channels. Application to Rapentosa basin, Eastern Attica, Greece allows useful conclusions regarding the use of DSMs produced via photogrammetry and the effect of DSM accuracy on inundated area delineation.