The Prime Minister and other Cabinet members have also pulled out of attending the Paralympic Games at the Black Sea resort as the situation worsens.
Last night Downing Street said: "In current circumstances, the Prime Minister is clear that the focus of our engagement with Russia must be the situation in Ukraine, rather than other normal business.
"The Foreign Secretary announced earlier today that the UK will not take part in any of the G8 preparatory meetings in Russia planned for this week.
"The Prime Minister and Foreign Secretary have also decided that it would be inappropriate for UK Ministers to attend the Sochi Paralympics in current circumstances."
No 10 added that Mr Cameron remains "fully supportive" of Team GB Paralympic athletes' participation at Sochi.
Mr Cameron was due to hold talks last night with AmericanPresident Barack Obama, Polish Prime Minister Donald Tusk and Lithuanian President Dalia Grybauskaite.
Meanwhile, Foreign Secretary William Hague flew to Kiev to meet the new Ukrainian authorities amid fears the nation could be on the brink of war with Russia.
A convoy of at least 13 troop vehicles with Russian number plates and four armoured vehicles with mounted machine guns surrounded a Ukrainian infantry base in Privolnoye in Ukraine's Crimea region, preventing anyone entering or leaving the base.
Mr Hague said the sovereignty and territorial integrity of Ukraine had been "violated" and called for Moscow to speak directly to the nation's new leaders.
He was speaking from RAF Northolt as he was about to board a plane to Kiev.
He said: "We have to recognise the sovereignty and the territorial integrity of Ukraine has been violated and this cannot be the way to conduct international affairs and so, in addition to calling yesterday's emergency meeting of the UN Security Council, the United Kingdom will join other G8 countries this week in suspending our cooperation under the G8, which Russia chairs this year, including the meetings this week for the preparation of the G8 summit.
"We will keep our approach to further G8 meetings under review."
Meanwhile, the newly appointed head of Ukraine's navy has sworn allegiance to the Crimea region, in the presence of its unrecognised pro-Russian leader.
Rear Admiral Denys Berezovsky was only made head of the navy on Saturday.
However, just 24 hours later he announced he had given orders to Ukrainian naval forces on the peninsula to disregard any orders from the "self-proclaimed" authorities in Kiev. He said yesterday would go down in history as the birthday of the "navy of the autonomous republic of Crimea".
New Ukrainian prime minister Arseniy Yatsenyuk has called on Russia to pull its troops out, warning: "We are on the brink of disaster".
US secretary of state John Kerry accused Russia of an "incredible act of aggression" and warned that it faces serious sanctions as well as risking its membership of the G8 group of leading nations.
Despite a 90-minute phone call between Mr Obama and Russian premier Vladimir Putin on Saturday, and other calls to the Kremlin by Europe's leaders, Russia shows no sign of backing away from its de facto occupation of Crimea and influence in east Ukraine.
US Secretary of State John Kerry told Russia it could face targeted sanctions including visa bans, asset freezes and trade isolation if it did not back down, and said major world powers were ready to isolate Moscow.
EU foreign ministers will hold an emergency meeting on the crisis today.
Several Nato and European Union member states depend almost entirely on Russia for energy, giving them reason to maintain relations even if they deplore Russian actions.