A group of Russian soldiers has crossed the Ukrainian border in armoured infantry carriers and trucks and entered the eastern town of Amvrosiyivka, according to a Ukrainian military spokesman.
A convoy of "up to 100" tanks, armoured vehicles and rocket launchers was seen travelling on a road toward Telmanove, a town about 80 kilometres south of rebel stronghold Donetsk and 20 kilometres from the Russian border, Ukraine's army said in a statement.
The army did not give details about the personnel on board the vehicles or when the column was thought to have entered Ukraine.
A military source said the convoy had come from Russia.
"We believe that this is Russian equipment. You cannot buy 100 tanks at a market in Donetsk or Lugansk," the source said.
"Of course they have been moved from across the border."
Military spokesman Andriy Lysenko said government forces had killed about 200 separatists and destroyed tanks and missile systems in clashes in the towns of Horlivka and Ilovaysk further north.
Mr Lysenko said 13 Ukrainian service personnel had been killed in the latest fighting and 36 people had been wounded.
If it turns out Russian soldiers are fighting in Ukraine it could further deepen the country's crisis — the focus of talks this week between Russian president Vladimir Putin and Ukrainian prime minister Arseny Yatseniuk.
US ambassador to Ukraine Geoffrey Pyatt said in a Twitter post: "The new columns of Russian tanks and armour crossing into Ukraine indicates a Russian-directed counter-offensive may be underway."
Meanwhile, Mr Yatseniuk claimed Russia planned to halt gas flows to Europe over the coming winter, comments which are likely to escalate the standoff between Moscow and the West.
"The situation in [Ukraine's] energy sector is difficult. We know of Russia's plans to block [gas] transit even to European Union countries this winter," he told a government meeting.
Russia stopped gas supplies to Ukraine in June over a gas pricing dispute but has continued supplies to Europe, its largest market.
Mr Yatseniuk did not say how he knew about the Russian plans.
Last year half of Russian gas exports to the EU were shipped via Ukraine.