Syrian troops and militia are suspected of killing more than 200 civilians in what is being described by activists as the worst atrocity so far in the 16 month long uprising against the government.
The Syrian Observatory for Human Rights says the assault began when the military bombarded a settlement in Hama province for about 10 hours using tanks and helicopters.
It says the survivors in the village of Tremseh - also known as Taramseh - where killed at close quarters by pro-government militia, known as shabiha.
One activist in Syria known as Rami told the BBC that over 200 people died in the attack.
And the Revolution Leadership Council of Hama told Reuters the Sunni Muslim village was shelled by Syrian troops and later stormed by a pro-government militia.
The organisation says reports suggest several people were killed by the shelling and more were then shot in the head.
An opposition activist who said he was in touch with residents said it appeared that Alawite militiamen from surrounding villages descended on Tremseh after its rebel defenders pulled out, and started killing people.
Another told Reuters people were trying to flee from the time the shelling started and whole families were killed trying to escape. The reports could not be independently confirmed.
If confirmed, the killings would be the worst single incident of violence in 16 months of conflict in which rebels are fighting to topple President Bashar al-Assad.
Syria's government later blamed "bloodthirsty media" and "terrorist gangs" for the massacre: its state-run SANA news agency alleges that bloodthirsty media in collaboration with gangs of armed terrorists massacred residents of Tremseh village.
It says their intention was to sway public opinion against Syria and its people and provoke international intervention on the eve of a United Nations Security Council meeting.