Vladimir Putin has recognised the independence of two breakaway regions of Ukraine.
At the end of an hour long televised speech to the Russian people on Monday evening, the president said Russia will recognise the self-proclaimed republics of Donetsk and Luhansk.
Mr Putin went on to sign agreements on cooperation and friendship with the Russian-backed regions.
The move could allow Russia to send troops into Ukraine in order to supposedly safeguard what it considers two independent nations.
Western powers condemned the move as a breach of international law and an infringement of Ukraine’s sovereignty and territorial integrity.
During his speech Putin said that modern Ukraine was created by communist Russia and referred to eastern Ukraine as “ancient Russian lands”.
While he claimed Ukraine was planning on developing its own nuclear weapons and called it a US colony with a “puppet regime”.
His address follows an earlier statement from the Kremlin that stated the Russian leader had informed the French and German leaders he intended to sign a decree recognising the Donetsk and Luhansk areas as independent states.
French and German leaders expressed their disappointment upon learning of the decision, the Kremlin said in a readout of the phone calls.
Moscow’s move is also likely to torpedo a last-minute bid for a summit to prevent Russia from invading Ukraine.
The areas, which are located in Ukraine’s eastern Donbas region, have been in battle with Ukrainian military forces since 2014.
Moscow has not made any steps to declare them as independent regions until now.
There are fears in the West and Ukraine that now Russian troops could be openly sent into the area and increase tensions in the embattled region.
French President Emmanuel Macron called an emergency national security meeting to address the latest developments, the Elysee Palace has said.
While Boris Johnson said: “This is plainly in breach of its national law, a flagrant violation of the sovereignty and integrity of Ukraine. A repudiation of the Minsk agreements and I think it’s a very ill omen and a very dark sign. It is certainly yet another indication that things are moving in the wrong direction.”
Foreign Secretary Liz Truss announced on Tuesday night that the Government “will be announcing new sanctions on Russia in response to their breach of international law and attack on Ukraine’s sovereignty and territorial integrity” on Wednesday.
It comes amid reports that tens of thousands of Russian troops have been been moved to within about 30 miles of Ukraine’s borders on Monday, with many of them now poised for an invasion, according to western officials.
They believe around 110 Russian battalion tactical groups, each compromised of around 700 to 800 troops, are now surrounding Ukraine.
Some two thirds of the BTGs are thought to be within about 30 miles of the border.
Of these, around half have moved from staging positions where they were postured for an operation to being tactically deployed and poised for an attack.
In response to the latest development Mr Johnson said the UK will be discussing with allies the potential implementation of sanctions against Russia.
The Prime Minister told the Downing Street news conference: “They will be triggered the first toecap of a Russian incursion or a Russian invasion.
“Plainly what has happened is extremely bad news and we will be urgently talking to our friends and allies all of whom are jointly signed up with us in this package of sanctions.
“It is becoming clear that we are going to need to start applying as much pressure as we possibly can. It is hard to see how this situation improves.”
One Western source said the situation around the threat of an invasion was now a very dark picture, with storm clouds gathering on Ukraine’s borders.
More air defence systems had been deployed, as well as more aircraft and armoured vehicles into forward locations.
The forward deployment of troops is understood to have taken place to allow attacks from Belarus in the north, where thousands of Russian forces have been carrying out drills, from Russia to the east and from annexed Crimea in the south.
The indications are for a large-scale invasion on multiple axis, with a series of military aims, according to the sources, which could involve a lightning operation to try to seize the capital Kiev within days.
Western officials expect if there is a Russian invasion of Ukraine, it will turn into a bloody and costly war for both sides.
Some figures within the Russian system are believed to share this concern.
While a diplomatic situation is still possible, the preparations on the ground are moving in one direction, towards an invasion, according to the sources.
It comes after Downing Street said intelligence reports suggest Russian President Vladimir Putin’s plan to invade Ukraine has already begun.
No10 added that “elements” of the Russian “playbook” for an attack were starting to “play out in real time”.
Ministers have highlighted what they believe to be a series of “false flag” operations, bombings and other strikes which the West believes Russia is seeking to wrongly blame on Ukrainian forces to justify a military intervention. Moscow denies it is planning to invade Ukraine.
Cyber attacks have also been launched against Ukrainian banks, which the UK has blamed on Russian military intelligence.