K.P. Kushwaha, chief paediatrician at the BRD Medical College in the state's hardest-hit Gorakhpur district, said it was one of the worst outbreaks of encephalitis in the impoverished region, which borders Nepal.
"The situation is grim and the epidemic is worse than previous years and with so many patients there are no empty beds at the hospital," Khuswaha said.
"We count such cases since January but most of these casualties have occurred since July."
He said more than 2,400 patients have been admitted to government hospitals in the region so far this year of which at least 430 have died.
"Until Saturday, 336 children and 94 adults have died," Kushwaha told AFP by telephone from the overcrowded hospital where patients were lying two to a bed.
He said 262 patients were undergoing treatment in the state-run facility.
"Everyday between 30 and 40 patients are being brought in for treatment," he said.
Some 215 people, a majority of them children, succumbed to encephalitis in Gorakhpur last year while the death toll from the disease in 2005 was more than 1,400 in Uttar Pradesh.
Eastern parts of Uttar Pradesh are ravaged by encephalitis each year as malnourished children succumb to the virus, officials say.
Encephalitis causes brain inflammation and can result in brain damage. Symptoms include headaches, seizures and fever.
Health experts say 70 million children nationwide are at risk of encephalitis.
Uttar Pradesh, India's most populous state, has been struggling for years with an encephalitis prevention programme, vaccinating millions of children against the virus.