Tensions over South Ossetia and another breakaway Georgian region, Abkhazia, have risen in recent months after Russia announced it was establishing formal ties with the separatists.
South Ossetia said that six people had died in fighting over the weekend.
Voicing his concern over the escalating situation, Grigory Karasin, the Russian deputy foreign minister, said "Georgian actions extremely close to Tskhinvali" could be considered as "military preparations".
But Mikheil Saakashvili, the Georgian president, dismissed suggestions Georgia wanted war in in the breakaway region.
"Confrontation is not in Georgia's interests and I hope and I'm sure that the continuation of confrontation is not in Russia's interests either," he said.
In a sign that Moscow is aiming for a negotiated solution, Yury Popov, Russia's ambassador-at-large, arrived in Georgia early on Thursday for talks.
But on Wednesday, South Ossetian officials said the talks had been called off and Popov himself said it seemed unlikely the negotiations would take place.
"I have arrived here for negotiations but as far as I know, South Ossetia doubts their appropriateness following the recent events," Popov said.
"If this is so, I will conduct shuttle diplomacy between Tbilisi and Tskhinvali."
Last week, hundreds of women and children were evacuated from South Ossetia in in preparation for a possible conflict.
Georgia's pro-Western government accuses Moscow of seeking to annex the two regions and derail Tbilisi's efforts to join the Nato military alliance.