Maj. Gen. Robert Mood of Norway, head of the U.N. Supervision Mission in Syria, said U.N. observers would discontinue patrols and stay in their locations until further notice, CNN reported.
"There has been an intensification of armed violence across Syria over the past 10 days," Mood said. "This escalation is limiting our ability to observe, verify, report as well as assist in local dialogue and stability projects -- basically impeding our ability to carry out our mandate."
U.N. monitors began their observation mission in Syria after an April 12 cease-fire to ensure President Bashar Assad and opposition fighters did not violate a six-point peace plan brokered by U.N.-Arab League special envoy Kofi Annan.
But the cease-fire did not hold and violence has escalated in recent days.
Monitors, who are unarmed, have repeatedly been attacked.
"The lack of willingness by the parties to seek a peaceful transition, and the push towards advancing military positions is increasing the losses on both sides: Innocent civilians, men, women and children are being killed every day," Mood said.
Mood noted the mandate of the U.N. Supervision Mission -- with 298 military observers and 112 civilian staff are in Syria -- runs out in July, Day Press News reported. After that, Mood said, the mission could be abandoned or strengthened with additional staff and equipment.
He said a "return to normal operations remains our objective."
The New York Times noted governments allied with Syria, in particular, Russia and Iran, have backed the peace plan as the only way to stop the violence.
Suspension of the observers' mission could spell the end of Western efforts to remove Assad through diplomatic means.
A bombing campaign such as the one NATO conducted in Libya last year would be impractical in Syria because battles are being fought in crowded cities, meaning targeting the Syrian army would likely risk high civilian casualties. Neither NATO nations nor the Arab League have shown support for sending in a ground force and fighting in what some believe is becoming a civil war.
Arming rebel groups is strongly opposed by most American officials, who fear they're not an organized force and they could turn on one another.
"The problem is that if we do nothing and Syria explodes, we have a broader conflict in the Middle East," a senior American diplomat said early last week, before the United Nations announcement. "But our options aren't any better than they were a year ago."
While the United States opposes including Iran in an international group Annan proposed to discuss salvaging the peace plan, Russia says Iran would have to be included.
Russia and Iran have not backed Assad's departure, while the United States, Saudi Arabia and other Arab states have supported the rebels and demand the Syrian president be removed.
Meanwhile, the violence continued Saturday with the opposition Local Coordination Committees of Syria reporting at least 25 people killed by noon.
The LCC said the Damascus suburb of Douma had faced a "choking siege by the regime's army" and residents were pleading for help amid a "severe shortage of medical personnel and supplies after continuous shelling over a number of hours."
Meanwhile, the Syrian Network for Human Rights charged Syrian tanks, armored vehicles and troops opened fire in Saqba, east of Damascus, Saturday, killing 19 civilians, including a woman and child.
"To add insult to injury, some of the victims were slaughtered by knives in a revengeful, sadist fashion reminiscent of the Dark Ages and utmost savagery," the group said in a statement.
The group said the Syrian government had hindered the transport of the wounded to hospitals.
Mood said the suspension of the U.N. monitoring mission would be reviewed daily.
Syrian opposition groups estimate that between 12,000 and 14,000 people have died in Syria since the uprising against Assad began in March 2011.
Rosie O'Donnell unveils nearly 50-pound weight loss
Putin thinks Obama would save him if he were drowning