The latest in a spate of tragedies prompted new criticism of Western brands who were accused by activists of placing profit before safety by sourcing their products from Bangladesh despite its shocking track record of deadly disasters.
Hundreds of thousands of workers walked out of their factories in solidarity with their dead colleagues as flags flew at half mast and a national day of mourning was held.
Plaintive appeals from trapped survivors filtering through the cracks in the concrete offered some hope, but emergency workers spent much of their day pulling out bodies.
"The death toll is now 204," senior police officer Moshiuddowla Reza told AFP, adding that most of the dead were from the 3,000-strong mostly female workforce in the building's garment factories.
The accident has again highlighted safety problems and poor working conditions that plague the textile industry in Bangladesh, the world's second-biggest clothing exporter.
Last November a blaze at a factory making clothing for Walmart and other Western labels in Dhaka left 111 people dead, with survivors describing how fire exits were kept locked by site managers.
"Garment entrepreneurs are above the law here. There is hardly any example of an owner being prosecuted for this kind of outright murder," Babul Akhter, head of the Bangladesh Garments and Industrial Workers Federation, told AFP.
"The Western retailers are also complicit because they give a blind eye to the manufacturers' shoddy practices," he said.
"Like manufacturers, these retailers are also using Bangladesh's army of cheap labourers as money-making machines."
At the scene of the disaster, relatives desperate for news descended on the scene in their thousands, clutching photographs.
There were a few moments of joy as a handful of survivors were plucked from the rubble.
"I became so hungry that at one stage I drank my urine," said an ecstatic Abul Hossain, 23, as he was pulled alive from the ruins more than 25 hours after the disaster.
But that was a rare shaft of light in an otherwise grim scene, as body after body was laid out on the grounds of a nearby school.
"I've seen all the bodies. My sister was not among them. She is also not in any of the hospitals," said Mukta Begum, holding the photo of her younger sibling Suryaban, a garment worker.
Survivors say the building developed cracks on Tuesday evening, triggering an evacuation of the garment workers employed there, but that they had been ordered back to the production lines.
"The managers forced us to rejoin and just one hour after we entered the factory the building collapsed with a huge noise," said a 24-year-old worker who gave her first name as Mousumi.
Low-cost British clothing chain Primark said one of its suppliers was based in the Rana Plaza, in the town of Savar, that collapsed at about 9:00 am (0300 GMT) on Wednesday.
"The company is shocked and deeply saddened by this appalling incident at Savar, near Dhaka, and expresses its condolences to all of those involved," it said in a statement.
Walmart said it was investigating to see if any factories in the Rana Plaza building had been among its suppliers.
Spanish fashion label Mango and Benetton of Italy were linked to the factories by the Bangladesh Center for Workers Solidarity, but said none of their Bangladeshi suppliers was involved.
Mahbubur Rahman, the operations director of the fire service, told AFP that rescuers had stopped using heavy clearing equipment to avoid jeopardising the chances of survival for those trapped alive.
"We're digging carefully and using only small machines to cut through the pancaked floors," he said.
Local police chief M. Asaduzzaman told AFP that cases have been filed against the owner of the building, a ruling party official, and the garment factory owners for death due to gross negligence.
Mustafizur Rahman, head of a police unit created to handle industrial problems, said the factory owners were in hiding after ignoring a warning not to reopen the building.
"After looking at the cracks on Tuesday, we told them to keep the plants shut. They defied our call," he told AFP.
About 3.6 million people work in Bangladesh's garment industry, making it the world's second-largest apparel exporter. Following the Tazreen fire, giant US retailer Wal-Mart Stores Inc. said it would take steps to alleviate safety concerns, while Gap Inc. announced a four-step fire-safety programme.
Wal-Mart said on Wednesday it had not determined whether a factory in the building that collapsed was producing goods for the company.
"Still we are struggling to overcome the odds after the Tazreen fire, now another incident which is a strong blow for the sector," BGMEA's Islam said.
Edward Hertzman, a sourcing agent based in New York who also publishes trade magazine Sourcing Journal, said pressure from US retailers to keep a lid on costs continued to foster unsafe conditions.
Hertzman, whose trade publication has offices in Bangladesh, said New Wave Bottoms Ltd occupied the second floor, Phantom Apparels Ltd the third, Phantom Tack Ltd the fourth and Ethar Textile Ltd the fifth.
The New Wave website listed 27 main buyers, including firms from Britain, Denmark, France, Germany, Spain, Ireland, Canada and the United States.
(With inputs from Reuters and AFP)