Russian forces have moved more troops into Crimea by ferry after seizing control of the border post on the Ukrainian side of the waterway, according to witnesses.
Aleksander Vitko, chief of Russia's Black Sea Fleet yesterday threatened a "real assault" against Ukranian forces stationed in the Ukrainian country unless they surrender or leave by today.
Soldiers who seized the isolated Black Sea peninsula have been surrounding the terminal for days, but until now had not taken control of Ukraine's border guard station.
The escalation of the biggest crisis between Russia and the West since the end of the Cold War came after the Russian soldiers seized the checkpoint after border guards tried to stop two buses with seven armed men aboard. The next ferry brought three truckloads of soldiers across, it was reported.
Ukrainian border guards said they had seen Russia assembling an armoured column on its side of the 2.7 mile-wide Kerch Strait that separates the Crimea peninsula from southern Russia.
In a statement released by the Moscow-based Interfax news agency, the Defence Ministry said: "If they do not surrender before 5am a real assault will be started against units and divisions of the armed forces across Crimea."
America is preparing to impose sanctions on Russia. US President Barack Obama has accused Russia of being "on the wrong side of history" with its military intervention in Ukraine and said he was examining diplomatic and economic steps to isolate Moscow.
Mr Obama said Russia had violated Ukraine's sovereignty and international law, and he warned Russian president Vladimir Putin to change course.
Mr Obama said: "Over time this will be a costly proposition for Russia and now is the time for them to consider whether they can serve their interests in a way that resorts to diplomacy as opposed to force."
US Secretary Of State John Kerry, who has arrived in Kiev, the Ukraine capital, has also raised the possibility of economic sanctions, such as asset freezes and visa bans on Russian individuals.
Prime Minister David Cameron, who discussed the crisis at the UK's National Security Council, said the world needed to send a "clear message" to Moscow.
He added: "What we want to see is a de-escalation, rather than a continuation down the path that the Russian government has taken, violating the sovereignty and territorial integrity of another country.
"So we shall have to bring to bear diplomatic, political, economic and other pressures to make this point. That is the very clear message the whole world needs to send to the Russian government."
Mr Putin has ignored the warnings from world leaders and won permission from his parliament to use military force in Ukraine. He has declared Moscow has the right to intervene in Ukraine to protect Russian citizens living there.
Ukraine's ousted leader Viktor Yanukovich has sent a letter to Mr Putin requesting he use the Russian military to restore law and order in Ukraine.
However, acting Ukranian president Oleksandr Turchinov said: "The situation in Crimea remains tense and Russia's military presence is growing. I appeal to Russia's leadership - stop the provocative actions, aggression and piracy. This is a crime and you will answer for it."
In Moscow, the stock market crashed, wiping billiions off the value of Russian companies.
EU leaders will hold an emergency summit on Thursday to discuss the Ukraine situation.
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