More than 1,300 people have been killed in a chemical weapons attack near Damascus, according to Syria's main opposition group.
The National Coalition claims toxic gas was used by President Bashar al Assad's forces during a bombardment of rebel-held areas outside the Syrian capital.
It described the attack as a "coup de grace that kills all hopes for a political solution in Syria".
The government said the claims were "totally false" and the international news organisations reporting them were "implicated in the shedding of Syrian blood and support terrorism".
Attacks are alleged to have occured in the towns of Zamalka aand Ein Tarma
It comes three days after a 20-strong team of UN weapons inspectors arrived in Damascus to investigate whether chemical weapons have been used in the conflict.
The European Union has demanded an independent investigation, and Russia a "fair and professional" probe into the alleged poison attack - which if confirmed would be the worst attack of its kind since Saddam Hussein killed an estimated 5,000 people in the Kurdish town of Halabja in 1988.
The US said it was "deeply concerned" by the reports and also called for an "urgent" investigation, demanding the Syrian government grant "immediate access" to the UN weapons inspectors.
"If the Syrian government has nothing to hide and is truly committed to an impartial and credible investigation of chemical weapons use in Syria, it will facilitate the UN team's immediate and unfettered access to this site," said White House spokesman Josh Earnest.
The United Nations said its chief weapons inspector was in talks with the Syrian government over the alleged attack, as the UN Security Council announced an emergency meeting behind closed doors later to discuss the situation.
Activists posted videos showing children apparently hurt in the attack
Earlier, Sky sources said at least 200 people were killed in the shelling in Zamalka and Ein Tarma, but could not verify whether chemical weapons were used.
Mohammed Saeed, an activist in the area, said hundreds of dead and injured have been taken to six make-shift hospitals in the eastern suburbs of Damascus.
"This is a massacre by chemical weapons," he said via Skype. "The visit by the UN team is a joke ... Bashar is using the weapons and telling the world that he does not care."
Opposition groups said government forces had fired "rockets with poisonous gas heads" in the attack.
Videos posted on YouTube by activists show children being treated in make-shift hospitals. Some are having convulsions and difficulty breathing. Others are not moving.
Sky News cannot authenticate the footage.
"Regime forces after midnight stepped up military operations in the East Ghouta and West Ghouta zones of the Damascus region with aircraft and rocket launchers, causing several dozen dead and wounded," the UK-based Syrian Observatory for Human Rights said.
The YouTube images cannot be authenticated by Sky News
The Local Co-ordination Committees, another Syrian pro-opposition group, said hundreds of people were killed or injured in the "brutal use of toxic gas by the criminal regime in parts of Western Ghouta".
Videos claiming to show the shelling were posted on YouTube by the Syrian Revolution General Commission, another activist group.
They showed what it called "a terrible massacre committed by regime forces with toxic gas, leaving dozens of martyrs and wounded".
Professor Fawaz Gerges, director of the Middle East Centre at the London School of Economics, examined the motive behind a chemical weapons attack.
He told Sky News: "Why would the Assad government use poison while you have a very strong UN team in Damascus?... and his army has the upper hand in the Ghouta area? He has done everything in his power to prevent western intervention."
Prof Gerges said the pressure would be "overwhelming", not just on the US but on Britain and France too, "to retaliate militarily" if a UN probe found evidence of a chemical weapons attack in the region east of the Syrian capital.
Casualties are much higher than in previous allegations of chemical attacks
"So it in this particular sense, it is very strange, it doesn't make sense, it's illogical, though we have learned in the last two-and-a- half years that irrationality is as important as rationality when it comes to the Assad regime," he added.
Both the rebels and government forces have accused each other of using chemical weapons in the conflict, which began in March 2011 and has killed more than 100,000 people.
The UN team is investigating three sites where chemical weapons have allegedly been used: the village of Khan al Assal, just west of the northern city of Aleppo, and two other locations, which are being kept secret for security reasons.
If confirmed, this alleged chemical attack would be the most serious in the conflict since the incident in Khan al Assal on March 19, when at least 30 people were killed.
Foreign Secretary William Hague said the UK would be raising the incident at the UN Security Council.
"I am deeply concerned by reports that hundreds of people, including children, have been killed in airstrikes and a chemical weapons attack on rebel-held areas near Damascus," he said.
"These reports are uncorroborated and we are urgently seeking more information. But it is clear that if they are verified, it would mark a shocking escalation in the use of chemical weapons in Syria.
"Those who order the use of chemical weapons, and those who use them, should be in no doubt that we will work in every way we can to hold them to account.
"I call on the Syrian Government to allow immediate access to the area for the UN team currently investigating previous allegations of chemical weapons use."