It said it was not immediately clear who was responsible for the strike on the town Hammuriyeh in the opposition bastion of Eastern Ghouta.
"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.
Airstrike on school kills 33 near Raqqa in Syria: monitor
It was not immediately clear if all the wounded were civilians or if some were rebel fighters, he said, adding that the death toll could rise further because a number of the injured were in serious condition.
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.
Islamic State claims responsibility for British parliament attack
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.
The government ally Russia and rebel backer Turkey brokered a nationwide truce in December, but violence has continued across the country.
COMMENTS
Comments are moderated and generally will be posted if they are on-topic and not abusive.
For more information, please see our Comments FAQ