The Cambodian Prime Minister confirmed the death toll on state television following the stampede at the end of an annual water festival.
Most of the victims were crushed or drowned, as thousands panicked when several people were electrocuted while celebrating the end of the festival.
Prime Minister Hun Sen apologised for the disaster on state TV. Some 278 people were originally reported dead by two hospitals. Among these, some 240 were reportedly women.
Many people died by leaping off the bridge across the tributary of Tonle Sap river in Phnom Penh to Diamond Island, according to authorities.
Others were trampled to death in the panic.
An investigation into the incident has been ordered by the Prime Minister as the recovery of bodies continues.
Hun Sen said: “This is the biggest tragedy in more than 31 years after the Pol Pot regime,” referring to the murderous Khmer Rouge regime whose agrarian revolution in 1975 killed an estimated 1.7 million people in Cambodia under the command of Pol Pot.
He said “it needs further investigation”.
He urged the country to remain calm and ruled out terrorism as the cause of the disaster. It took place on the third and final day of the Bon Om Touk water festival.
Owned by a local bank, Diamond Island is a small island equipped with conference and exhibition centres, restaurants and entertainment areas.
It is a popular venue for women shoppers, especially during the water festival when discounts are offered on clothing and other goods. Many of the victims are believed to have attended a concert and were returning home to the city when the stampede began.