Many dryland rivers are terminal systems, with small channels undergoing prominent downstream size reductions before ending on channelless floodplains, in wetlands, or at playa margins. Spaceborne Digital Elevation Models (DEMs) provide potential for assessing subtle topographic and hydrodynamic changes in these low-gradient, low-relief settings, but challenges are posed by limitations in vertical and horizontal accuracy. This study evaluates the use of different spaceborne DEMs for topographic characterisation and flood flow modelling of the low-gradient (<0.0006 m m⁻¹) Río Colorado terminal system, Bolivia. A comparison between DEM and field dGPS elevation data (1290 measurement points) reveals that the TanDEM-X DEM 12 m (TDX-12 m) has a RMSE of 0.47 m, far less than those of other frequently used spaceborne DEMs such as ALOS RTC (4.58 m) and SRTM (6.02 m). For hydrodynamic modelling, TDX-12 m data were smoothed (adaptive filter and feature-preserving DEM smoothing) and upscaled. The smoothed TDX-12 m data were mosaiced with a dGPS data-derived river path, surveyed along a reach (mean width <30 m) with a prominent downstream size decrease. The methods enabled effective de-noising of the TDX-12 m data (RMSE 0.29 m) and resulted in a high linear regression correlation coefficient (0.75). HEC-RAS 2D modelling reveals that in the selected reach, overbank flooding starts in the downstream part when discharge is <18 m³/s, with flow initially spreading through crevasse channels and levee topographic lows. As discharge increases, flow spreads farther across the floodplain, ultimately forming connected floodplain flow in distal topographic lows. Satellite imagery and a derived water index indicate the same floodplain flow patterns as the modelling (critical success index 0.77). Wider use of DEMs based on TDX-12 m data for topographic characterization and flood flow modelling along relatively small, low-gradient terminal dryland rivers will result in many scientific and applied benefits.