William Spindler, spokesman for the UN High Commisioner for Refugees [UNHCR] said: "The confirmed death toll is now 34. The 123 still missing are presumed dead."
The UN agency quoted Yemeni officials as saying that they had captured 17 smugglers and were continuing the search for survivors.
Spindler said the majority of the 357 survivors were Somalis, and 75 were Ethiopians.
Antonio Guterres, the UN high commissioner for refugees, said: "I am deeply saddened by this latest tragedy involving smugglers' boats carrying desperate people across the Gulf of Aden."
Fleeing war
About half of the Somalian survivors said they were fleeing fighting between Ethiopian-backed Somali government forces and rival Islamic Courts fighters, Spindler said. UNHCR has asked neighbouring countries to be prepared to accept those fleeing.
Ali Mohamad Gedi. the Somali prime minister, swept into Mogadishu in an armed convoy on Friday after rival fighters fled the city they had ruled for six months.
More than 25,800 people have been recorded arriving in Yemen from Somalia this year, according to UNHCR. The boats from Somalia usually land along a remote stretch of tribal-ruled coastline.