Assad joined prayers at a Damascus mosque for the Eid al-Fitr festival, his first appearance in a public place since a bomb blast last month killed four top security officials, although he has been seen on television since then.
Across the country, Syrians joined prayers and staged demonstrations for Eid, taking place for the second year under the shadow of an unrelenting conflict that activists say has now claimed 23 000 lives since March last year.
Despite the religious festival, government forces pounded several rebel strongholds, including the main northern battleground of Aleppo, a watchdog said, on the day UN observers were winding up their troubled mission.
A girl and a boy were among nine people killed, the Syrian Observatory for Human Rights said. It also reported at least 137 deaths on Saturday, and said 42 bodies had been dumped in Al-Tal town in Damascus province, in a gruesome sign of escalating brutality.
"We put sandbags on the windows before we started praying, in case the army shelled the mosque," said an activist in the Old City of Homs in central Syria who identified himself as Abu Bilal.
Increasingly bloody fight
Meanwhile, press reports said British and German spies were involved in covert operations to help Syrian rebels in their increasingly bloody fight to topple Assad's embattled regime.
"We can be proud of the significant contribution we are making to the fall of the Assad regime," an official from Germany's BND foreign intelligence service told Bild am Sonntag.
The paper said German spies were stationed off the Syrian coast and also active at a Nato base in Turkey, whose government is staunchly opposed to the Assad regime and is sheltering Free Syrian Army rebels.
Britain's Sunday Times said British intelligence was helping rebels launch successful attacks on government forces with information gathered from their listening posts in nearby Cyprus.
It said the most valuable intelligence has been about the movements of troops towards the flashpoint commercial hub of Aleppo, which is now partly controlled by rebels and is the scene of some of the fiercest fighting.
The regime's far superior military might has failed to suppress the poorly armed rebels, whose determination to bring Assad down has only grown with the passing of time.
But Assad, from the minority Alawite community, has characterised the conflict as a battle against a foreign "terrorist" plot aided by the West and its allies in the region, led by Sunni Muslim powerhouse Saudi Arabia.
"Syria will triumph against the Western-American plot being supported by the Wahhabis and takfiris [Sunni Muslim religious hardliners]," declared the imam at the Al-Hamad mosque, where a smiling Assad joined the prayers along with top regime officials.
"Our enemies among the Americans, the Zionists and their agents should be rejoicing to see us killing each other and sowing discord among us," Sheikh Mohammed Kheir Ghantus said.
With the bloodletting showing no signs of abating, the opposition lashed out at new international envoy Lakhdar Brahimi, branding as "unacceptable" his reported comments that it was too soon for him to call for Assad to go.
Brahimi's comments only served to give Assad's government a "licence to kill tens of thousands more Syrians," the Syrian National Council said.
The West is demanding Assad step down as part of any political deal to end the 17-month conflict but is opposed by Syria's traditional allies in Moscow and Beijing which see it as foreign-imposed regime change.
Brahimi, who replaced Kofi Annan, nevertheless won support from the West as well as China and Russia, although the White House said it would be seeking clarifications on the terms of his mandate.
Amid Western speculation that more top officials were ready to abandon Assad, Syrian state television insisted that Vice President Faruk al-Shara had not left the country after opposition and media reports that he had defected.
"Mr Shara has never thought about leaving the country or going anywhere," the television said on Saturday.
Shara (73) is the most powerful Sunni Muslim figure in the minority Alawite-led regime and has served in top posts for almost 30 years.
A former deputy oil minister who defected in March said Shara was actually under house arrest and that other top officials were also being kept under surveillance.
Among those to have abandoned the embattled regime are former prime minister Riad Hijab and high profile general Manaf Tlass – a childhood friend of Assad, while his defence minister and three top security chiefs were killed in the July bomb attack claimed by the FSA.
UN observers were preparing to wrap up their mission at midnight on Sunday after chief observer General Babacar Gaye accused both sides of failing to protect civilians.
The UN originally sent in 300 unarmed observers in April but its patrols were suspended in June because of the escalating violence, which has sent at least 170 000 Syrians fleeing while another 2.5 million inside Syria are estimated to need aid. – Sapa-AFP