State television showed thousands of people gathered for the funerals of the 26 victims, the Los Angeles Times reported.
The Interior Ministry promised an "iron fist" in response to the attack Friday in the Maidan neighborhood.
But activists said eyewitnesses reported ambulances arrived in the neighborhood well in advance of the bombing and correspondents for state TV began their coverage soon after the explosion, the Haaretz newspaper in Israel said. They also said al-Arabiya filmed a state TV correspondent distributing bags around the blast site and then reporting they had belonged to victims.
Mourners showed on television Saturday demanded the departure of the Arab League monitoring team and shouted support for President Bashar Assad.
Opposition leaders have said violence directed against protesters has not abated since the monitors arrived. The league has scheduled an emergency meeting Sunday in Cairo to discuss removing the monitoring team.
Syria has banned most foreign correspondents, and those allowed in are limited in where they can go.