Rival jihadist movement Al-Qaeda distanced itself from the mass shooting Friday in the main southern city of Aden, saying it was not responsible.
Gunmen stormed the refuge for the elderly operated by Mother Teresa's Missionaries of Charity, killing a Yemeni guard before tying up and shooting 15 other employees, officials said.
Four foreign nuns working as nurses were among those killed.
The Vatican missionary news agency Fides identified the nuns as two Rwandans, a Kenyan and an Indian, adding that the mother superior managed to hide and survive while an Indian priest was missing.
Screams of elderly residents echoed from the home during the shooting rampage, witnesses said, recounting seeing the bodies of slain workers with their arms tied behind their back.
No group has yet claimed the attack in the war-torn country, where the internationally recognised government is grappling with both an Iran-backed rebellion and a growing jihadist presence.
'Treacherous terrorist acts'
An unnamed Yemeni presidency source in Riyadh said that those behind such "treacherous terrorist acts" are individuals who have "sold themselves to the devil," in a statement on the official sabanew.net website.
"There was no trace of these groups, which go under the name of the Islamic State or (its Arabic acronym) Daesh" when pro-government forces were battling the Huthi rebels and their allies to push them out of Aden last year, the source said, accusing them of "switching roles" with the Iran-backed rebels.
In a statement addressed to the residents of Aden, Al-Qaeda in the Arabian Peninsula (AQAP), also known as Ansar al-Sharia, denied "any links to the attack on the elderly care home".
"These are not our operations and this is not our way of fighting," said the group, which has seized parts of southern and eastern Yemen.
Al-Qaeda has previously criticised IS for attacks on Shiite mosques in Yemen that left dozens dead.
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Al-Qaeda and IS have stepped up attacks in Aden, targeting mainly loyalists and members of a Saudi-led coalition battling the Huthi rebels since March last year.
The Huthis controlled Aden for months before government loyalists pushed them out in July.
On Saturday, gunmen opened fire at a police patrol in Aden killing two policemen, a security official said.
President Abedrabbo Mansour Hadi has declared the city to be Yemen's temporary capital as Sanaa has been in the hands of the Huthis and their allies since September 2014.
But Hadi and many senior officials spend most of their time in Riyadh.
'Senseless and diabolical'
The Vatican's Secretary of State Pietro Parolin said that "his Holiness Pope Francis was shocked and profoundly saddened to learn of the killing of four Missionaries of Charity (nuns) and 12 others at a home for the elderly in Aden."
"He sends the assurance of his prayers for the dead and his spiritual closeness to their families and to all affected from this act of senseless and diabolical violence," Cardinal Parolin said in a statement.
Violence has mounted in Yemen during the past year with more than 6,000 people killed since the Saudi-led coalition began its campaign of air strikes in late March 2015.
On Saturday, Hadi discussed the stalled peace process with UN envoy Ismail Ould Cheikh Ahmed in Riyadh, sabanew.net reported.
"Goodwill gestures and confidence-building measures by releasing detainees, lifting the siege on cities, and opening safe corridors to deliver humanitarian assistance to besieged provinces... are necessities that must be met" by the rebels, Hadi told the UN envoy.
Saudi Arabia's UN ambassador said Friday that he hoped peace talks could resume by March 15.
The United Nations says more than 80 percent of the population is in dire need of food, medicine and other basic necessities and the crisis ranks as a "Level 3 emergency", the most serious in the UN system.