Heavy rains have hampered search operations on Friday at the site of a massive landslide in Sri Lanka where more than 100 people were buried under tonnes of mud and rubble.

Fears of further landslips in the rain-sodden hills around the tea-plantation village of Haldummulla also slowed efforts to recover those who died.

The death toll from Wednesday's landslide was revised down from 300 when it emerged that many schoolchildren and plantation workers were at a safe distance when the avalanche engulfed their homes.

Latest data from Sri Lanka's Disaster Management Centre (DMC) showed that 183 people had survived out of a total of 330 who lived in the area in south-central Sri Lanka.

As soldiers and police worked to clear mounds of earth, survivors were housed in two temporary camps set up nearby.

Disaster management minister Mahinda Amaraweera told parliament the cabinet had decided to help them build new homes in a safe location. The US and India have also offered assistance.

The minister, who visited the disaster site, said earlier it was unlikely there would be any survivors.

A local resident said around 150 clay and cement houses had been buried in the landslide, which was three kilometres long and was triggered by days of heavy monsoonal rains.

Ravichandran Gajini, 14, said her parents had left their house before the landslide but hurried back in to retrieve documents.

"Both mother and father asked me to run with my brother and went to get their important documents. But when I turned back, I saw the earth covering both of them," she said.

K Krishnamoorthy, a 58-year-old plantation worker, said there had been warnings of landslides since 2002 and residents had been advised to leave but not offered anywhere else to settle.

Many people in the hilly area some 190 kilometres from the capital Colombo are Indian-origin Tamils, descendants of workers brought to Sri Lanka under British rule as cheap labour.

Reuters