Gatwick bosses learnt that a damaging flood would hit the airport only half an hour before it happened on Christmas Eve, the West Sussex airport's chief told MPs.
The flooding was the worst at the airport since 1967, Gatwick chief executive Stewart Wingate told the House of Commons Transport Committee.
He said he was "very sorry" about what happened on Christmas Eve when many flights had to be cancelled and others were badly delayed.
Mr Wingate went on: "A lot more could and should have been done for passengers. Our actions fell short."
He was speaking at a special one-off evidence session called following the major flood-related disruption at Gatwick on Christmas Eve which led to flight cancellations and long delays.
Passengers complained about a lack of information, with some waiting many hours for flights before having to go home after learning that their flight had, ultimately, been axed.
Gatwick has invited all those who flights were cancelled on Christmas Eve to apply for £100 shopping vouchers as a gesture of goodwill.
Gatwick has begun its own investigation into the pre-Christmas problems while the Civil Aviation Authority has said it is looking into the matter.
Mr Wingate said that as it was Christmas Eve the decision was taken to try to move passengers from the flood-affected North Terminal to the South Terminal to try to get them away on flights.
He added that if it had been any other day then flights would have been cancelled straight away.
He told the committee that forecasters had advised the airport bosses that high winds were the problem they would face on Christmas Eve.
But at 4.15am on Christmas Eve airport chiefs had been told that the nearby River Mole would flood in 30 minutes. In addition the 68mm of rain that hit the airport was far more than forecast, Mr Wingate said.
Mr Wingate told MPs: "Historically we were told that there was very little risk of flooding to the North Terminal. It was an exceptionally low risk. "
He added that it was always anticipated that in the event of bad weather there would be more risk to the South Terminal.
Mr Wingate told the committee that he was on annual leave - in Newcastle upon Tyne - on Christmas Eve. "We were not anticipating this event," he said adding that he had remained on conference call all day.
Mr Wingate said: "We all decided we wanted to go the extra mile (to get people away for Christmas). It was a step too far.
"We did something with the best of intentions and we were partially successful. Half of the flights that had been due to depart from the North Terminal did so and all the South Terminal flights got away.
"We are very sorry about what happened to passengers."
He said that the problems were "not just about Gatwick airport". There had been difficulties on the nearby M23 and on the rail routes serving the airport. In addition, the flooding had affected the instrument landing system at Gatwick, with the River Mole running in a culvert right under the runway.
Mr Wingate went on: "This was an enormous event but it was so much more than just Gatwick airport."
Mr Wingate was asked if the Christmas Eve disruption had damaged Gatwick's case for a second runway. He replied that Gatwick had "an exceptional case" and could build another runway quickly and cheaply.
He added that it was also important "to look at the timeline", pointing out that the airport had not seen such a flood since 1967.
Jason Holt, easyJet's Gatwick head, said he had been presented with scenes of "biblical proportions" in the North Terminal on the morning of Christmas Eve, with around 3,000 noisy customers needing to be quietened.
He said he had explained the effects of the flood to passengers adding that there were "a lot of distressed people looking to get away, many with youngsters and babies".
Mr Holt said that the airline had no screens, no IT and no information given to them. The airline, he added, had to "ferret around" to get information.
He said easyJet had gone along with the plan to move people from the north to the south terminal but it was only at 1pm that the airline heard that there were only four buses available to ferry passengers between the two terminals.
Mr Holt said: "We said four was not enough but we were told it was Christmas Eve and there weren't any more."
Peter Duffy, easyJet's customer director, said as soon his airline heard about the scarcity of buses a decision had been taken to cancel a number of flights.
Mr Wingate said that on another occasion, even on Christmas Eve, a decision would be taken to cancel flights earlier. The transfer attempt was "unprecedented" and he understood just how upset passengers were who had had flights cancelled late in the day on December 24.
Committee member Graham Stringer (Lab: Blackley and Broughton) questioned the "independence" of Gatwick's own inquiry into the pre-Christmas problems which is being led by David McMillan, a non-executive director of the airport.
Describing the Christmas Eve events as a "fiasco", Mr Stringer said Mr McMillan's first duty would be to Gatwick shareholders.
Mr Wingate stressed that Mr McMillan was a former director general of Eurocontrol, the European Organisation for the Safety of Air Navigation and that Gatwick would happily help with any Civil Aviation Authority or Department for Transport inquiries.
Mr Wingate said Gatwick planned to invest "many more millions of pounds" to ensure such disruption would not re-occur. Estimates given to the airport in 2008 said that flooding at South Terminal was "a once every 20 years" event and that the flood risk for the North terminal was "between a once every 100 years and once every 1,000 years event".
He went on: "Clearly, all this will have an impact on our reputation."
He said he hoped that the planned extra investment would lead to a regaining of passengers' trust.