An attack in the Syrian village of Tremseh appeared to target the homes of army defectors and activists, and assailants used weapons including artillery and mortars, the spokesman for the UN observers in Syria said.
The observers entered the village on Saturday after activists said about 220 people had been killed there by President Bashar al-Assad's troops.
The observers saw damaged houses and a burned school and planned to return to the village on Sunday, they said, adding the number of casualties was unclear.
UN Secretary General Ban Ki-moon has expressed outrage at the latest reported mass killing in Syria and said any failure by the international community to take action would be a licence for further massacres.
The UN mission in Syria has confirmed there was a big military operation on Thursday in an area where opposition activists say more than 200 people were killed in the village of Tremseh.
In a letter to the UN Security Council, the UN-Arab League special envoy Kofi Annan said the Syrian government had violated its commitment to stop using heavy weapons in population centres.
Mr Ban said: "I condemn, in the strongest possible terms, the indiscriminate use of heavy artillery and shelling of populated areas, including by firing from helicopters.
"They also cast serious doubts on President al-Assad's recent expression of commitment to the six-point plan in his meeting with the Joint Special Envoy."
Mr Assad met with international envoy Kofi Annan in Damascus on Monday.
US Secretary of State Hillary Clinton has urged the UN Security Council to make clear to Syria that there would be consequences after the massacre.
Accounts of the attack on the village of Tremseh provide "indisputable evidence that the regime deliberately murdered innocent civilians," she said.
"Those who committed these atrocities will be identified and held accountable," Mrs Clinton said.
Syrian opposition activists have put the death toll at Tremseh at anywhere from 100 to more than 200 people and said it was the work of government troops and militia allies.
Mrs Clinton said the massacre underscored the need for major powers to increase pressure on President Bashar al-Assad's government to allow for a UN-backed political transition plan to move forward.
She said the UN Security Council - where veto-holders Russia and China have thrown the brakes on western efforts to pass more punitive measures against Syria - should now make clear that there would be consequences for non-compliance.
There has been no independent account of what happened in Tremseh, which the government described as a massacre by "terrorist groups".
Syrian authorities severely restrict the activities of independent journalists.
Gilmore wants killings referred to ICC
Tánaiste and Minister for Foreign Affairs Eamon Gilmore has said the recent killings in Syria should be referred to the International Criminal Court.
Mr Gilmore said there had to accountability for the killings and said he would like to see the UN Security Council refer the matter to the ICC.
The minister also said there needs to be a strong UN resolution, which would mean the Kofi Annan peace plan could be put in place and to ensure UN forces can operate effectively in the country.
He appealed to UN Security Council members, and in particular to China and Russia, to work together to bring a resolution about.