Pro-Russian armed rebels have dealt a blow to Ukraine's hopes of re-establishing control over the country's east, as world leaders planned four-way talks on the country's crisis.
Separatists on Wednesday raised Russian flags after capturing a column of Ukrainian armoured vehicles, a humilation for the government in Kiev a day after it launched an "anti-terrorist operation" in the east.
The incident happened as the convoy entered the eastern town of Kramatorsk, on its way to counter pro-Russian rebels in nearby Slovyansk.
Russian media reported that the crew of the convoy switched sides, but Ukraine denied the report.
A journalist of the Associated Press news agency overheard a Ukrainian soldier suggesting that the troops were forced at gunpoint to hand over their vehicles.
In the eastern regional capital of Donetsk, armed militias seized the mayor's office, demanding that the Ukrainian government hold a referrendum on giving the east more autonomy.
In Kiev, Arseniy Yatsenyuk, Ukraine's interim prime minister, accused Russia of orchestrating the unrest.
"Russia has a new export: Russia is now exporting terrorism to Ukraine," Yatsenyuk told a cabinet meeting.
"Russia must withdraw its sabotage groups, condemn terrorists and liberate all administrative buildings."
The Ukraine crisis will be discussed in Geneva on Thursday among the representatives of Ukraine, Russia, the US and the EU.
Andrii Deshchytsa, the Ukrainian foreign minister, said late on Wednesday that his country's main demand at the talks would be the withdrawal of Russian troops from Ukraine's eastern frontiers and Crimea, annexed by Russia in March.
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NATO meanwhile announced on Wednesday that it would strengthen its military presence along its eastern border.
"Today we have agreed a package of military measures," Anders Fogh Rasmussen, the NATO chief, said after an alliance meeting. "We will have more planes in the air, more ships on the water ... and more readiness on the land."
However, the measures appeared to amount to more air and sea patrols in the Baltic region, far from Ukraine.
No new naval deployments to the Black Sea area were mentioned, although "more would follow if needed", and no additional ground forces were included in the measures except for more alliance staff to aid training.
Rasmussen said that could change in the future, but gave no further details. The measures are in place until at least the end of the year.
The announcement came after Russia's president, Vladimir Putin, raised fears of outright Russian intervention after saying that Ukraine was on the brink of civil war.