"We freed about 100 bodies trapped in the hold of the 16-metre (50-foot) wooden boat which foundered not far from the coast," Abdellatif Mohammed Ibrahim told AFP.
Another 70 bodies were washed up by the tide, including five young children, he said.
"It looks like the boat overturned suddenly, leaving the passengers no chance," he said as Red Cross rescuers pulled bodies from the water.
Ibrahim said no leaks were found in the hull of the vessel, shipwrecked off the coast of Guarabouli district, 60 kilometres (40 miles) east of Tripoli.
But the few papers recovered showed the victims included migrants from Ethiopia and Eritrea.
On Friday, the coast guard said it had saved 16 people and recovered 15 bodies.
He said today that recovery of the remaining bodies was slow because the coast guard service has "a major shortage of resources."
Libya, mired in unrest and political chaos, has been a launchpad for illegal migrants seeking a better life in Europe but who turn to people smugglers to cross the Mediterranean.
Around 150 Syrians were arrested yesterday in Algeria, where they were preparing to enter Libya illegally in the hope of crossing to Europe, an Algerian newspaper reported.
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