The bodies were recovered after a wall of unstable earth collapsed Monday night following heavy rain in the town of Hpakant in Kachin state, the centre of a multi-billion-dollar trade that feeds a huge demand for the precious stones from neighbouring China.
"We retrieved seven dead bodies last night and five more this morning," a police officer in Myanmar's capital Naypyidaw told AFP, requesting anonymity.
But efforts to look for more bodies among the rubble have been halted as renewed rain threatens to trigger fresh landslides.
Confirming the death toll Nilar Myint, a local official in Hpakant, said around 50 people were searching for the stone when an earth wall inside the mine collapsed.
"We are checking homes near the landslide to see who is missing among their friends and relatives," she told AFP.
The area has suffered a string of deadly landslides over the past year, with a major incident in Hpakant last November killing more than 100.
Numerous other smaller accidents have left scores more dead or injured, including a landslide that killed 13 people earlier this month.
A resident told AFP hundreds of people have been searching for gems in the craters scooped out by the mining giants during Myanmar's rainy season, when major companies cease operations.
"Locals said that area was a favourite of companies and workers because it had good quality stones. That is why many people were gathering and searching in that particular place," he said on the condition of anonymity, adding that rain and poor roads have hampered the rescue.
But while mining firms -- many linked to the country's junta-era military elite -- are thought to be raking in huge sums, locals say they do not share in the bounty.
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