Syrian security forces opened fire on protesters outside a mosque in a Damascus suburb, close to a building that members of the Arab League monitoring mission were visiting, activists say.
At least four people were killed, they said.
The ongoing violence, and new questions about the human rights record of the head of the Arab League monitors, are reinforcing the opposition's view that Syria's limited co-operation with the observers is nothing more than a farce.
They say President Bashar Assad's regime is trying to buy time and thwart more international condemnation and sanctions.
Rami Abdul-Rahman, head of the British-based Syrian Observatory for Human Rights, said about 20,000 people were protesting outside the Grand Mosque in the Damascus suburb of Douma when troops opened fire.
Some Arab League monitors were visiting a municipal building close to the mosque, he said.
The Observatory said a total of 16 people have been shot by security forces and killed so far today, most of them in several suburbs of Damascus.
The Local Co-ordination Committees, another activist group, said 28 people were killed.
Leading opposition members have called on the Cairo-based Arab League to remove the Sudanese head of the monitoring mission to Syria because he was a senior official in the "oppressive regime" of President Omar al-Bashir, who is under an international arrest warrant on charges of committing genocide in Darfur.
The 60 Arab League monitors who began work on Tuesday are the first Syria has allowed in during the nine-month anti-government uprising. They are supposed to be ensuring the regime is complying with terms of the Arab League plan to end a crackdown the UN says has killed more than 5,000 people since March.
The head of the mission, Lt Gen Mohamed Ahmed Mustafa al-Dabi, is a longtime loyalist of al-Bashir and once served as his head of Sudanese military intelligence.
Amnesty International said under al-Dabi's command, military intelligence in the early 1990s "was responsible for the arbitrary arrest and detention, enforced disappearance, and torture or other ill-treatment of numerous people in Sudan".
Meanwhile, German Foreign Minister Guido Westerwelle demanded "unhindered access" for the observers to all key points in Syria.
That includes "also the possibility to speak unhindered with representatives of the opposition, civil society and with prisoners of the regime".