Design of hydraulic structures, flood warning systems, evacuation measures, and traffic management require river flood routing. A common hydrologic method of flood routing is the Muskingum method. The present study attempted to develop a three-parameter Muskingum model considering lateral flow for flood routing, coupling with a new optimization algorithm namely, Improved Bat Algorithm (IBA). The major function of the IBA is to optimize the estimated value of the three-parameters associated with the Muskingum model. The IBA acts based on the chaos search tool, which mainly enhances the uniformity and erogidicty of the population. In addition, the current research, unlike the other existing models which consider flood routing, is based on dividing one reach to a few intervals to increase the accuracy of flood routing models. Three case studies with lateral flow were considered for this study, including the Wilson flood, Karahan flood, and Myanmar flood. Seven performance indexes were examined to evaluate the performance of the proposed Muskingum model integrated with IBA, with other models that were also based on the Muskingum Model with three-parameters but utilized different optimization algorithms. The results for the Wilson flood showed that the proposed model could reduce the Sum of Squared Deviations (SSD) value by 89%, 51%, 93%, 69%, and 88%, compared to the Genetic Algorithm (GA), Particle Swarm Optimization (PSO) algorithm, Pattern Search (PS) algorithm, Harmony Search (HS) algorithm, and Honey Bee Mating Optimization (HBMO), respectively. In addition, increasing the number of intervals for flood routing significantly improved the accuracy of the results. The results indicated that the Sum of Absolute Deviations (SAD) using IBA for the Karahan flood was 117, which had reduced by 83%, 88%, 94%, and 12%, compared to the PSO, GA, HS, and BA, respectively. Furthermore, the achieved results for the Myanmar flood showed that SSD for IBA relative to GA, BA, and PSO was reduced by 32%, 11%, and 42%, respectively. In conclusion, the proposed Muskingum Model integrated with IBA considering the existence of lateral flow, outperformed the existing applied simple Muskingum models in previous studies. In addition, the more the number of intervals used in the model, the better the accuracy of flood routing prediction achieved.