The Collaborative International Dictionary of English v.0.48:

Flume \Flume\ (f;[=u]m), n. [Cf. OE. flum river, OF, flum, fr.
   L. flumen, fr. fluere to flow. [root]84. See Fluent.]
   A stream; especially, a passage channel, or conduit for the
   water that drives a mill wheel; or an artifical channel of
   water for hydraulic or placer mining; also, a chute for
   conveying logs or lumber down a declivity.
   [1913 Webster]

WordNet (r) 3.0 (2006):

flume
    n 1: a narrow gorge with a stream running through it [syn:
         gulch, flume]
    2: watercourse that consists of an open artificial chute filled
       with water for power or for carrying logs