The Prime Minister said he was "extremely concerned" about reports of major troop movements from Russia into south eastern Ukraine and warned the activity must stop.
The crisis in Ukraine will be at the top of the agenda of next week's Nato summit in Wales, where Mr Cameron will meet with other alliance members to discuss collective security at Europe's eastern border.
The European Council is also due to hold a summit on Saturday.
Shots have been fired and around 1,000 Russian troops have crossed the border into Ukraine. Nato estimates another 20,000 Russian troops are stationed on their side of the border.
In a statement, Mr Cameron said: "I'm extremely concerned by mounting evidence that Russian troops have made large-scale incursions into South Eastern Ukraine, completely disregarding the sovereignty of a neighbour.
"The international community has already warned Russia that such provocative actions would be completely unacceptable.
"President Putin has said that Russia is willing to find a peaceful solution to the conflict.
"But this is not credible when Russia is supporting pro-Russian separatists."
Earlier, Ukraine's president Petro Poroshenko said: "Russian forces have entered Ukraine."
Nato has now published satellite images that appear to show Russian armed forces inside the Ukrainian territory.