NATO on Wednesday accused Russia of sending fresh columns of tanks, troops and military hardware into Ukraine as Kiev said it was preparing for a return to combat in the war-torn east.
The claims come amid growing fears of a return to all-out conflict in the region despite a two-month ceasefire which has stopped much frontline fighting but not shelling at strategic flashpoints.
The UN Security Council was set to hold an emergency session to discuss the crisis in the former Soviet state at 1930 GMT, with the Organization for Security and Cooperation in Europe (OSCE) set to deliver an update.
NATO's commander in Europe, US General Philip Breedlove, claimed that Russian military equipment was entering eastern Ukraine.
"Across the last two days we have seen the same thing that OSCE is reporting. We have seen columns of Russian equipment, primarily Russian tanks, Russian artillery, Russian air defence systems and Russian combat troops entering into Ukraine," he said during a visit to Sofia.
That was swiftly dismissed as "unfounded" by Russia's defence ministry. The Kremlin denies that it is involved in the fighting which has rocked east Ukraine since early April.
However, Russia openly gives political backing to the self-declared separatist statelets in the east, and it is unclear how else the rebels could have acquired their heavy weaponry.
Moscow deployed unmarked troops to seize the Ukrainian peninsula of Crimea in March, first denying they were its forces before admitting it had sent in soldiers.
Meanwhile, Ukraine's Defence Minister Stepan Poltorak said Kiev was getting set for a possible new round of fighting after seeing "increased activity" by Russia and pro-Moscow rebels in the east.
"The main task I see is to prepare for combat operations. We are doing this, we are readying our reserves," Poltorak said at the start of a cabinet meeting.
"We observe their movements, we know where they are and we expect unpredictable actions from them."
He described the situation in the conflict zone as "complicated but stable".
The OSCE, which is monitoring the ceasefire, warned Tuesday of a "rising" risk of an escalation in the conflict, which has claimed more than 4,000 lives since April, according to UN figures.
Its observers also reported seeing a convoy of 43 unmarked military trucks -- five towing Howitzer heavy artillery pieces and another five towing multi-launch rocket systems -- travelling into the rebel stronghold of Donetsk on Tuesday.
It was the latest in a string of recent sightings of unmarked trucks and heavy weapons heading towards the frontline in rebel-controlled areas.
On the ground, several hours of heavy artillery fire rocked Donetsk on Wednesday, the most intense fighting since the weekend.
The explosions of mortars being fired from near the city centre towards government positions at the ruined airport continued throughout the morning but had calmed down by early afternoon, an AFP correspondent said.
Ukraine's military said one soldier had been killed and five wounded as its positions came under repeated shelling around the region over the past 24 hours.
Government forces also accused the insurgents of trying to capture a strategic location along the volatile frontline, delineated as part of the ceasefire deal, north of the second-largest rebel stronghold Lugansk.
With fears rising of all-out war, Ukraine's central bank hiked interest rates Wednesday by 1.5% to 14% after inflation rose to nearly 20% last month, while the currency, the hryvnia, continued to tumble on money markets.
The Ukraine crisis has sent relations between Russia and the West plummeting to their lowest point since the Cold War.
Following the UN Security Council session and the Asia-Pacific Economic Cooperation (APEC) summit in Bejing earlier this week, Russian President Vladimir Putin is likely to face further pressure at a G20 summit in Brisbane from Saturday.
Ukraine, supported by Western nations, accuses Russia of supplying pro-Kremlin separatists with the missile that shot down Malaysia Airlines flight MH17 over eastern Ukraine in July.
The disaster, which Moscow and the rebels blame on Ukrainian forces, killed all 298 people onboard, including 38 Australian citizens and residents.
Dutch experts at the MH17 crash site said Wednesday they had discovered more human remains after a crane lifted parts of the wreckage.
The head of the team, Pieter-Jaap Aalbersberg, said they had now "done everything they could" to retrieve body parts and personal belongings.
They are hoping to start work soon on recovering the wreckage of flight MH17 but doubts have been raised given the fragile security situation and no agreement with rebels on how to proceed.