Saudi Arabia and Kuwait recalled their envoys to Damascus after the Arab League condemned violence in Syria, leaving President Bashar al-Assad further isolated as he defended his crackdown on 'outlaws'.

Hours after the Saudi envoy's recall, rights activists said on Monday a mother and her two children were shot dead by security forces in the eastern city of Deir Ezzor, where 42 people were reported killed on Sunday in an army assault.

The recalls by Riyadh, the Arab world's Sunni Muslim heavyweight, and by fellow Gulf Cooperation Council (GCC) member Kuwait, mark a major escalation of pressure on Assad.

His regime has reacted with brutal repression to a pro-democracy uprising that has left at least 2,059 people dead, among them nearly 400 members of the security forces, according to the Syrian Observatory for Human Rights.

"Saudi Arabia announces the recall of its ambassador for consultations," King Abdullah said in a statement after Syrian security forces killed more than 50 people on Sunday.

The statement urged Damascus to 'stop the killing machine and the bloodshed... before it is too late'.

"The kingdom does not accept the situation in Syria, because the developments cannot be justified," Abdullah said, urging 'comprehensive and quick reforms'.

"The future of Syria lies between two options: either Syria chooses willingly to resort to reason, or faces being swept into deep chaos, God forbid," he said.

"Large numbers of martyrs have fallen, their blood has been shed, and many others have been wounded... This is not in accord with religion, values and morals," he said.

The Saudi decision was followed by Kuwait, the second member of the six-nation GCC to recall its ambassador.

"No one can accept the bloodshed in Syria... The military option must be halted," Kuwait's Foreign Minister Sheikh Mohammad al-Sabah told reporters.

"There will be a meeting for the GCC foreign ministers soon and a joint GCC move to discuss the issues related to Syria."

Security forces on Monday shot dead a mother and her two children fleeing the military assault on Deir Ezzor, the Britain-based Syrian Observatory cited residents as saying.

"The woman and her two children were trying to flee the Huweika district for somewhere safer when they were targeted by a security patrol," it quoted residents as saying, adding that the father of the family was wounded.

An elderly woman was also killed in the city's Al-Jura district, the group said.

Activists said security forces backed by tanks killed 42 civilians in Deir Ezzor and at least 10 more in the central town of Hula on Sunday.

Assad roundly defended his security forces on Sunday.

"To deal with outlaws who cut off roads, seal towns and terrorise residents is a duty of the state which must defend security and protect the lives of civilians," state news agency SANA quoted him as saying.

SANA also quoted an official military source as dismissing claims that tanks were shelling Deir Ezzor as 'completely false and untrue'.

The Arab League on Sunday made its first official statement on the unrest, calling on Damascus to 'immediately' stop the violence.

Secretary General Nabil al-Arabi also urged an 'impartial probe' into the bloodshed.

US and European leaders pledged to consider new steps to punish Syria after security forces killed more than 30 people on the first Friday of Ramadan, the holy Muslim month of fasting.

EU nations are eyeing new sanctions against individuals and businesses linked to the clampdown, EU diplomats asking not to be identified said on Monday.

Germany warned on Monday that Assad will forfeit legitimacy if his regime continues the deadly crackdown.

"If President Assad maintains his refusal to engage in dialogue with the Syrian people and continues to resort to violence, the German government will consider he has forfeited his legitimacy in further overseeing the fate of his country," deputy government spokesman Christoph Steegmans told reporters.

He said Chancellor Angela Merkel also regretted that Assad had failed to take to heart UN security council appeals to renounce violence, and welcomed the recent EU strengthening of financial and diplomatic sanctions against leading regime members.

The Assad regime has pledged reform and blamed 'armed terrorist gangs' for the unrest.

Witnesses and activists on Monday reported tanks and troops entering Maaret al-Numan in Idlib province bordering Turkey and carrying out 'a large number of arrests'.

Overnight, demonstrations were reported in the central city of Homs, with the Syrian Observatory saying security forces wounded at least one protester.