By Dominic Evans

BEIRUT (Reuters) - International mediator Lakhdar Brahimi said after talks with Syria's President Bashar al-Assad on Saturday that the escalating conflict in the country posed a global threat.

Activists say 27,000 people have been killed in the 18-month-old uprising against Assad. Late on Saturday, 20 bodies, including a woman's, were found by residents in a district of Damascus that had been overrun by Assad's troops, a watchdog said.

"This crisis is deteriorating and represents a danger to the Syrian people, to the region, and to the whole world," Brahimi told reporters in Damascus after speaking with Assad for an hour at the presidential palace.

It was the veteran Algerian diplomat's first meeting with the Syrian leader since he replaced Kofi Annan as mediator two weeks ago, taking on a mission that he described as "nearly impossible".

The revolt started as a mainly peaceful street campaign for reform but has become a bloody insurgency that is deepening sectarian rifts in the Middle East. Activists say 160 people, mostly civilians, were killed on Friday.

Assad's forces and the out-gunned but increasingly effective rebel fighters seeking his overthrow have ignored appeals to end the conflict, which continues to affect most of Syria's main cities, including Damascus, Aleppo, Homs and Deir al-Zor.

"Ten men and a woman were found in a house in Tadamon," said Rami Abdulrahman, head of the Syrian Observatory for Human Rights. "Another nine were found in a separate building and all had gunshots to the body," he added, quoting residents.

Over the past two days, the army have been conducting street to street raids of Tadamon after days of government artillery strikes and helicopter attacks aimed at killing rebel fighters.

Damascus residents reported hearing heavy overnight bombardment followed by the sound of jet planes swooping over the capital shortly after 7 a.m. (12.00 a.m EDT) on Saturday.

One resident, who asked to remain anonymous, said black smoke was rising from the southern Damascus neighborhood of Hajar al-Aswad, which neighbors Tadamon, on Saturday afternoon.

"There is very strong shelling to the south of Damascus. The roads have been closed and there are tanks," the resident said.

The mainly Sunni Muslim rebels are supported by Gulf Arab states and neighboring Turkey in their struggle to topple Assad, whose minority Alawite faith is an offshoot of Shi'ite Islam. Shi'ite Iran has been Assad's staunchest ally.

"It's not a secret that the gap between the parties is very wide," Brahimi said, adding that he still believed there was "common ground" for them to resolve the crisis.

BENEDICT'S APPEAL

Louay Hussein, a prominent Syrian opposition activist in Damascus who met Brahimi, said the mediator "knew the map of the crisis ... (and was) optimistic".

Assad allows a few opposition figures to operate in the country but they have little influence over the opposition in exile and the armed revolt.

Syrian authorities say they are fighting Islamist "terrorists" and accuse regional Sunni Muslim powers of worsening the bloodshed by helping arm the president's foes.

State news agency SANA quoted Assad as telling Brahimi that the success of his mission hinged on "pressuring countries which finance and train the terrorists, and which traffic weapons to Syria, to stop these actions".

His comments came a day after Pope Benedict, starting a three-day visit to neighboring Lebanon, branded the flow of arms into Syria a "grave sin" and called for a halt to it.

World powers are deadlocked in the U.N. Security Council along Cold War lines, with the United States and its NATO allies supporting the call for Assad to quit and Russia and China defending him against what they see as outside meddling.

Moscow and Beijing have three times blocked Western-backed attempts in the Security Council to criticize Damascus and threaten sanctions against it.

"I believe that the president realizes more than me the dimensions and the danger of this crisis," said Brahimi, who has met Russian, Chinese and Iranian diplomats in Damascus.

The mediator said Assad and his officials had pledged to support his work, adding that he would return to the region soon after talks in New York with U.N. Secretary-General Ban Ki-moon.

(Additional reporting by Oliver Holmes; editing by Andrew Roche)