The Sunday newspaper has reported a circulation of 296,023 for March, dropping 2.14% from the previous month, according to the ABC figures.
The Observer lifted its cover price from £2 to £2.20, matching The Sunday Times, on 13 March.
It is the world’s longest published Sunday newspaper, dating back to 1791.
The Guardian News & Media (GN&M) paper had teetered around the 300,000 mark in February and in December last year. However, March marks the first time it has fallen below that figure.
The rival Independent on Sunday was the only the Sunday quality title to lift its circulation last month, rising 0.3% to 153,183. This represented its highest circulation this year.
The Independent on Sunday’s figure was inflated by 52,791 bulk copies – those which newspaper groups sell for a nominal fee to airlines, hotels and gyms, and which they give away free.
In February, the newspaper gave away 63,810 bulk copies.
The Sunday Times – which has put online content behind a paywall – reported a circulation of 1,031,727, down 1.32% on the month, and its lowest circulation of the year.
The Sunday Telegraph, which is set to introduce a metered paywall in September, also fell – by 1.29%, to stand at 481,941.
Circulation figures for the mid-market and red-top titles were largely surprise-free, down an average of 1.4% to 2%.
The News of the World remains far and away the country’s biggest-selling Sunday paper, with a circulation of 2,664,363.
|National newspaper ABC figures March 2011|
|Monthly Circ||Mnth/mnth||Yr/Yr (Mar)|
|Sunday Titles||Mar-11||% change||% change|
|Daily Star Sunday||293,489||-2.93%||-14.14%|
|News of the World||2,664,363||-1.62%||-8.27%|
|The Mail on Sunday||1,888,040||-1.90%||-3.31%|
|Independent on Sunday||153,183||0.26%||-0.71%|
|The Sunday Telegraph||481,941||-1.29%||-5.46%|
|The Sunday Times||1,031,727||-1.32%||-7.19%|