A convoy of hundreds of Russian troops today headed toward the capital of Ukraine's Crimea region, a day after Russia's forces took over the strategic Black Sea peninsula without firing a shot.
The new government in Kiev has been powerless to react.
Ukraine's parliament was meeting today in a closed session.
Russian President Vladimir Putin has defied calls from the West to pull back his troops, insisting that Russia has a right to protect its interests and the Russian-speaking population in Crimea and elsewhere in Ukraine.
There has been no sign of ethnic Russians facing attacks in Crimea, where they make up about 60 per cent of the population, or elsewhere in Ukraine. Russia maintains an important naval base on Crimea.
President Barack Obama spoke with Putin by telephone for 90 minutes yesterday and expressed his "deep concern" about "Russia's clear violation of Ukrainian sovereignty and territorial integrity," the White House said.
Obama warned that Russia's "continued violation of international law will lead to greater political and economic isolation."
The US also said it will suspend participation in "preparatory meetings" for the Group of Eight economic summit planned in June at the Black Sea resort of Sochi, where the Winter Olympics were held.
French Foreign Minister Laurent Fabius agreed, saying on French radio Europe that planning for the summit should be put on hold. France "condemns the Russian military escalation" in Ukraine, and Moscow must "realize that decisions have costs," he said today.
But the US and other Western governments have few options to counter Russia's military moves.
NATO's North Atlantic Council, the alliance's political decision-making body, and the NATO-Ukraine Commission were to meet today. NATO Secretary-General Anders Fogh Rasmussen said the allies will "coordinate closely" on the situation in Ukraine, which he termed "grave."
Ukraine is not a NATO member, meaning the US and Europe are not obligated to come to its defense. But Ukraine has taken part in some alliance military exercises and contributed troops to its response force.
On the road from Sevastopol, the Crimean port where Russia has its naval base, to Simferopol this morning, Associated Press journalists saw 12 military trucks carrying troops, a Tiger vehicle armed with a machine gun and also two ambulances.
Ukraine's acting president, Oleksandr Turchynov, announced late yesterday that he had ordered Ukraine's armed forces to be at full readiness because of the threat of "potential aggression."
Additionally, Ukraine today warned it was on the brink of disaster and called up all military reservists after Russia's threat to invade its neighbour drew a sharp rebuke from the United States and NATO.
The dramatic escalation in what threatens to blow up into the worst crisis between Moscow and the West since the Cold War came as pro-Kremlin forces seized control of key government buildings and airports in the predominantly Russian-speaking Crimean peninsula.
Russia's parliament yesterday voted to allow President Vladimir Putin to send troops into its western neighbour -- a decision US President Barack Obama swiftly branded a "violation of Ukrainian sovereignty".
And NATO's chief declared that Russia's actions in the former Soviet state were a threat to peace and security in Europe.
Ukraine's new pro-Western Prime Minister Arseniy Yatsenyuk also warned any invasion "would mean war and the end of all relations between the two countries."
"We are on the brink of a disaster," Yatsenyuk told the nation in a televised address. "This is not a threat. This is a declaration of war on my country."
As world leaders held urgent meetings on the crisis, pro-Moscow gunmen were controlling large swathes of the rugged Black Sea peninsula that has housed Kremlin navies since the 18th century.
Witnesses said Russian soldiers had also blocked about 400 Ukrainian marines at their base in the eastern Crimean port city of Feodosiya and were calling on them to surrender and give up their weapons.
The largely untested interim team that took power in Kiev just a week ago braced for Moscow's first possible invasion of a neighbour since a brief 2008 confrontation with Georgia by putting its military on full combat alert yesterday.
Ukraine's national security and defence council said it would call up all reservists and start preparations for a possible invasion from its giant neighbour to the east.
Ukraine says Russia has already sent 30 armoured personnel carriers and 6,000 additional troops into Crimea to help pro-Kremlin militia gain broader independence from Kiev.
Putin said yesterday he had a duty to protect ethnic Russians in Crimea and southeastern swathes of Ukraine which have ancient ties to Moscow and look on Kiev's new pro-EU leaders with disdain.
But NATO chief Anders Fogh Rasmussen, speaking before an emergency meeting of the transatlantic alliance, told Russia to stop its military activity and threats against Ukraine, saying its action threatened "peace and security in Europe".
The US and its Western allies have threatened to boycott the June G8 summit in the Russian Black Sea resort of Sochi.