Ukraine has accused Russia of declaring war on its territory and warned that the country is on the "brink of disaster".
Prime Minister Arseniy Yatseniuk said: "This is the red alert, this is not a threat. This is actually a declaration of war to my country."
"If President Putin wants to be the president who started a war between two neighbouring and friendly countries, between Ukraine and Russia, he has reached his target within a few inches. We are on the brink of disaster."
Ukraine put its army on full combat alert after Russia deployed a further 15,000 troops in Crimea. The Ukrainian parliament is also due to meet on Sunday for an emergency session.
Hundreds of unidentified gunmen and at least 17 military vehicles with Russian number plates are reported to have surrounded a military base just outside the Crimean capital Simferopol, preventing soldiers from leaving.
More Russian troops are reported to be on their way to Ukraine, prompting fears of a full-scale military invasion.
Nato's Secretary General Anders Fogh Rasmussen convened an emergency meeting of Nato ambassadors in Brussels on Sunday and called on Russia to ease the military standoff.
"What Russia is doing now in Ukraine violates the principles of the United Nations Charter," he said. "It threatens peace and security in Europe. Russia must stop its military activities and its threats.
"We support Ukraine's territorial integrity and sovereignty. We support the right of the people of Ukraine to determine their own future without outside interference and we emphasise the need for Ukraine to continue to uphold the democratic rights of all people and ensure that minority rights are protected."
World leaders were united in their condemnation of Russia's military action in Ukraine, with US President Barack Obama, UK Prime Minister David Cameron, German Chancellor Angela Merkel and UN Secretary General Ban ki-Moon all calling for Russia to scale back its military offensive.
In a 90-minute telephone call, Obama told Russian President Vladimir Putin that his actions are in breach of international law, including the UN charter and Russia's 1997 military basing agreement with Ukraine.
The UK also highlighted its concern over escalating tensions and has become the latest country to pull out of the preparatory talks due to be held in the coming days for the G8 summit in Sochi.
The move follows an announcement by Canadian Prime Minister Stephen Harper that Canada will not take part in meetings leading up to the G8 summit .