More than 45,000 people have been killed since the conflict broke out in March 2011, but 39,362 of those perished during the past 12 months, the majority civilians, said the Britain-based watchdog.
The civilian toll of 28,113 includes those who have taken up arms against the regime of President Bashar al-Assad, it said.
Government troops suffered heavy losses, with 9,482 people killed, while 1,040 military defectors also were killed in action. Another 727 people in the 2012 toll were unidentified.
"The death toll of the regime forces is actually higher, but the government keeps these figures under wraps," said Observatory director Rami Abdel Rahman.
On the other hand, he said, "the rebels are discreet about their total losses of life in order to keep up morale, while the deaths of foreign fighters are not announced in their home countries."
The increase in the total number of deaths was due to a fierce escalation in the methods of crackdown by the regime, Abdel Rahman said.
"The year 2012 was the bloodiest and most destructive because all kinds of heavy weapons as well as regime warplanes were used in battle," he told AFP by phone.
The uprising began in March 2011 with peaceful protests inspired by the Arab Spring, but steadily morphed into an armed rebellion following a brutal government crackdown on dissent.