Otto, the seventh Atlantic hurricane has hit north of the town of San Juan de Nicaragua as a Category 2 storm, the Miami-based hurricane center said.
Although it had weakened to a category 1 storm, it has a sustained wind of 21km stretching about 8km southwest of San Carlos, Nicaragua.
Moments after the storm, a 7.0 magnitude quake struck in 93 miles (149 km) southwest of Puerto Triunfo, El Salvador, at a depth of 10km, reuters reports.
However there had been no eports of any casualties from either the hurricane and the quake but people within the region of both disasters had been evacuated.
Nicaraguan President Daniel Ortega declared a state of emergency because of the storm and the quake, his spokeswoman and wife, Rosario Murillo, said.
Nicaraguan civil protection officials said the hurricane, which was moving west at 12 mph (19 kph), damaged homes and telephone lines but that there had not been reports of any victims.
In Bluefields, a city in Nicaragua’s southeastern Mosquito Coast, rainfall began early in the morning, and hundreds were moved to storm shelters by Thursday evening.
“We left because we don’t want to die. We love our lives,” said 53-year-old Carmen Alvarado, who was hunkering down in a school in Bluefields. She was among the 206 people evacuated from the coastal community of El Bluff.
“The fear there is that we were surrounded by water,” said Senelia Aragon, 42, standing next to Alvarado, preparing a breakfast of flour tortillas with beans.