It said it was not immediately clear who was responsible for the strike on the town Hammuriyeh in the opposition bastion of Eastern Ghouta.
It said it was not immediately clear who was responsible for the strike on the town Hammuriyeh in the opposition bastion of Eastern Ghouta, which has been targeted by both the government and its ally Russia in the past.
"Sixteen civilians, including a child, were killed and around 50 others wounded in an air strike on the main street in the town of Hammuriyeh," Observatory director Rami Abdel Rahman said.
He could not immediately confirm if all the wounded were civilians, or if some were rebel fighters.
The death toll could rise further because a number of the injured were in serious condition, he added.
An AFP photographer saw members of the White Helmets rescue organisation removing survivors from the aftermath of the street, including a man whose face was coated in blood.
Other White Helmet volunteers sprayed water from hoses onto smoking rubble including overturned and mangled cars.
Elsewhere, a man carried two children, a girl in yellow fluffy pyjamas, her hair stiff with dust, and a smaller child whose head was haphazardly bandaged.
Another carried the lifeless body of a child, half its head missing below a crop of black curls.
The Eastern Ghouta region outside Damascus has been under a devastating government siege since 2012, and is also the regular target of regime air strikes and artillery fire.
It is the last remaining opposition stronghold near Damascus, where a string of local "reconciliation deals" have seen villages and towns brought back under the control of President Bashar al-Assad's government.
More than 320,000 people have been killed in Syria since the conflict began in March 2011 with anti-government protests.
Government ally Russia and rebel backer Turkey brokered a nationwide truce in December, but violence has continued across the country.