The bloodshed occurred in Eringeti, a town 55 kilometres (35 miles) north of the regional hub Beni, a city hit by a series of attacks that have claimed more than 700 civilian lives according to regional official Amisi Kalonda, who blamed the latest strike on Ugandan rebels.
Kalonda said members of the Allied Democratic Forces (ADF), a group of rebels dominated by puritanical Ugandan Muslims and entrenched in the region for about two decades, stormed the town on Saturday afternoon.
"The ADF has yet again plunged the people of Eringeti and its surrounding areas into mourning," he told AFP, speaking from the North Kivu capital Goma.
"Yesterday, they killed 10 civilians. Twelve other bodies were found (Sunday) in the surrounding villages."
"The modus operandi is always the same," he said, adding that the victims were either killed with knives or machetes.
For the past two years the region around Beni has been afflicted by massacres that have killed hundreds of civilians, most of whom were hacked to death.
Congolese officials have blamed the attacks on the ADF but several expert reports have suggested that other groups, including elements within the Congolese army, took part in some killings.
Congolese army spokesman Mak Hazukay confirmed the attack, saying military forces had "killed four ADF rebels" but added that "the toll on the civilian side is very heavy".
Teddy Kataliki, the head of a prominent local civic group, also spoke of at least 22 victims. But a Catholic priest in the area said there had been 27 deaths and the toll could rise "if bodies are found in the forest" bordering the town.
- 'Toll likely to rise' -
The priest said the Christmas midnight mass was held in the afternoon before nightfall for security reasons.
"Yesterday the bodies of 10 civilians were found and today another 12," Kataliki said, adding that this was a provisional toll.
"We don't understand this situation which continues to bereave the region of Beni."
Kataliki said another such attack was underway on Sunday evening in the town of Oicha, further south.
An army spokesman said troops were engaged in an operation in the area but refused to provide further details.
The priest however said, when contacted late Sunday, that the army "has pushed back the attackers".
When the Beni massacres kicked off in October 2014, the ADF was quickly branded the culprit by both DR Congo authorities and MONUSCO, the UN mission in DR Congo.
More than two years on, Congolese authorities and the UN have been unable to protect civilians and the ADF remains the only official explanation -- with the government insisting on a jihadist link to the killings.
It comes as relations with the international community have soured over President Joseph Kabila's refusal to step down despite his term ending on December 20.