NATO has confirmed that columns of Russian tanks, artillery and troops have entered Ukraine, with the government in Kiev also declaring preparations for combat operations in the face of alleged "increased activity" by Russia and pro-Russian rebels.
Wednesday's developments raised the possibility of eastern Ukraine descending into all-out violence despite a shaky ceasefire deal signed in September.
"The main task I see is to prepare for combat operations. We are doing this, we are readying our reserves," Stepan Poltorak, Ukraine's defence minister, said on Wednesday, adding that the situation in the conflict zone was "complicated but stable" for now.
For his part, General-Major Igor Konashenkov, a Russian Defence Ministry official, dismissed the NATO accusations as anti-Russian "hot air", saying "there was and is no evidence".
However, in televised comments at the start of a cabinet meeting, Poltorak reported that pro-Russian separatists had taken on "reinforcements".
"We observe their movements, we know where they are and we expect unpredictable actions from them."
In a related development, US General Philip Breedlove, NATO's supreme commander, lent his weight to a report by the Organisation for Security and Cooperation (OSCE), released last week, that said columns of Russian tanks were entering Ukraine.
"We agree that there are multiple columns that we have seen; we agree with the OSCE reports. And as to their intent: I'm not sure," Breedlove said during a visit to Sofia, Bulgaria, on Wednesday.
"My strategic team believes that there is a possibility that, as you know, this pocket of separatist Russian-backed forces and Russian forces in the east of Ukraine - it's not a very contiguous pocket.
"What worries me the most, I've said before, is that we have a situation now where the former international border, the current international border, of Ukraine and Russia, is completely porous; it is completely wide open. Forces, money, support, supplies, weapons are flowing back and forth across this border completely at will."
Al Jazeera's Rory Challands, reporting from Moscow, said what had been announced by Breedlove was not new, but could lead to the situation being taken more seriously.
"What makes this an escalation is that these comments have come from NATO's top commander," he said.
"Politicians will listen to this very carefully."
Russia has repeatedly denied claims that its troops are moving across the border into rebel-held eastern Ukraine, despite openly offering its backing to elections in the separatist areas.
"The Russian Defence Ministry has batted away these comments," our correspondent said.
"Russia has always maintained it has no military involvement in Ukraine and is not sending troops or weaponry."
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In his remarks rejecting the NATO statements, Konashenkov, the Russian defence official, said: "We have already stopped paying attention to unsubstantiated statements by NATO's Supreme Allied Commander Europe, General Philip Breedlove, on Russian military convoys he 'observed' allegedly invading Ukraine."
OSCE observers had reported seeing a convoy of 43 unmarked military vehicles, five towing Howitzer heavy artillery pieces and another five towing multi-launch rocket systems, travelling into the rebel stronghold of Donetsk on Tuesday.
Al Jazeera's Albina Kovalyova, reporting from Donetsk, said the military presence had been increasing in recent days.
"We ourselves witnessed a military column travelling to Donetsk yesterday," she said.
"There's certainly a build-up, with daily sightings of military convoys and escalation of fighting.
"The Ukrainian Defence Ministry has announced it is going to prop up its military to defend against possible rebel advances across their territory."
On the ground, several hours of heavy artillery fire rocked Donetsk, the most intense fighting since the weekend.
Source: Al Jazeera and agencies