As tens of thousands of opposition supporters massed in Kiev on Monday, the capital's city council refused to recognise the official results and urged parliament to follow suit.
Two cities in the opposition-dominated west, Lviv and Ivano-Frankivks, also refused to recognise the results, sparking fears that Sunday's election could further polarise the deeply divided country.
With votes from 99.14% of polling stations counted, Prime Minister Viktor Yanukovich had secured 49.42% of the vote compared to 46.69% for his Western-leaning rival, Viktor Yushchenko, the central electoral commission said.
Yushchenko, however, pledged defiance. "We are launching an organised movement of civil resistance," he said.
"The campaign is only just beginning. Don't leave Independence Square until victory," he told a crowd of tens of thousands of supporters massed in a central square in Kiev.
Yushchenko, who had been put comfortably ahead in exit polls, denounced the runoff vote as a "total falsification".
Prime Minister Yanukovich is said
to have taken 49.42% of the vote
Western observers likewise slammed the vote, with US Senator Richard Lugar telling reporters: "It is now apparent that a concerted and forceful programme of election-day fraud and abuse was enacted with either the leadership or cooperation of governmental authorities."
"I believe that President [Leonid] Kuchma has the responsibility and the opportunity for producing, even at this point, an outcome which is fair and responsible," added Lugar, who was sent by US President George Bush to monitor the election.
Call for strikes
Another opposition leader, Yulia Timoshenko, called for students to boycott classes and a general strike as the opposition, which had declared victory on Sunday night, went on the offensive as it sought to mobilise a wave of popular protest.
Kiev's main street, Khreshchatik, was closed to traffic by police as tens of thousands of people converged on Independence Square.
The protesters waved orange flags - the colour of the opposition - as they chanted "Yushchenko president!"
The disputed results heightened concerns of a violent standoff between the opposition and the government of this strategic ex-Soviet state.
Opposition leader Yushchenko
has pledged defiance
Kuchma, who has anointed his prime minister as his chosen successor as he steps down after 10 years of strong-arm rule, has warned that there would be "no revolution" and vowed to maintain public order.
Ukraine's security bodies warned they would put down any lawlessness quickly and firmly.
"We appeal to the organisers of mass protests to assume responsibility for their possible consequences," said a statement issued by the prosecutor general, the interior ministry and the security services.
The European Union called on Kiev authorities to show restraint in the face of public protests.
Dutch Foreign Minister Bernard Bot, whose country currently holds the EU's rotating presidency, also called on Ukrainian authorities to review the second round poll result, after international monitors highlighted problems.
"We are very concerned about the news we have had about the outcome," said Bot during a break in talks among EU foreign ministers in Brussels.
He added that all the EU's 25 member states would be calling in Ukrainian ambassadors "to convey our message of serious concern about the outcome" and urging Kiev "to review ... the electoral process and its result".
The EU has called for restraint in
resolving the vote results
Referring to reports of opposition protesters gathering in Kiev and other cities in Ukraine, he said: "We call for restraint, and all sides to express themselves only in a non-violent manner."
The vote is seen as one of the most important in eastern Europe since the 1991 collapse of the Soviet Union. It will determine whether the nation of nearly 50 million turns towards Europe or remains under Moscow's shadow.
The central electoral commission has until 6 December to announce the final vote count, which the opposition claims will give more time for falsifying the outcome.