The House of Commons Defence Committee has highlighted the "alarming deficiencies" in the alliance's state of preparedness for a Russian attack and called for a "continuous presence" of Nato troops in the Baltic with the re-establishment of large-scale military exercises.
Its view, in a report published today, comes as the UK is preparing to send a full battle group of 1350 military personnel to take part in a Nato military exercise in Poland in October.
Yesterday, as Ukrainian separatists were said to be digging in at the site of the Malaysian plane crash, again preventing access for investigators, Nato generals noted the number of Russian troops massing along the Ukraine border was "well over 12,000".
Moscow began to count the cost of tougher US/EU economic sanctions, denouncing them as "destructive and short-sighted" and warning they would lead to higher energy prices in Europe.
However, the Committee said Nato had not considered Russia an adversary for 20 years but was now forced to do so because of events in Ukraine, including the annexation of Crimea, as well as the cyber attack on Estonia in 2007 and the invasion of Georgia in 2008.
Such developments should be a "wake-up call" for the West, it said.
One of its key recommendations is that Nato draws up plans for the "pre-positioning of equipment in the Baltic states", so that should it be necessary to deploy troops, there would be a base containing all the necessary mobile equipment from rocket launchers, small arms ammunition to trucks and other military vehicles.
MPs in particular pointed to Estonia and Latvia, which have substantial Russian minorities and, combined with the influence of Russia's media, could make them "vulnerable to the type of information warfare and inciting of disturbances that have caused such chaos in Ukraine".
They called for "dramatic improvements" to the alliance's rapid reaction force and its processes for warning of an imminent attack and recommended the creation of a "red team" within the Ministry of Defence to challenge its existing orthodoxy together with the employment of extra defence attaches in central and eastern Europe.
The Committee also recommended new tactics be developed to respond to the threat of "ambiguous" attacks from Russia, including how to counter threats from cyber, information warfare and irregular militia; they suggested changing Article 5 of Nato's defence strategy to remove the adjective "armed" from the phrase "armed attack".
Their report said Russian Federation actions in Ukraine had raised the prospect, however unlikely, of a Russian attack on a Nato state and the alliance needed to take much more action to deter that risk.
Committee chairman Rory Stewart said: "The risk of attack by Russia on a Nato member state, whilst still small, is significant. We are not convinced Nato is ready for this threat."
Accusing the alliance of being "too complacent", he said: "The instability in Russia, President Putin's world view and the failure of the West to respond actively in Ukraine means we have to address urgently the possibility, however small, of Russia repeating such tactics elsewhere."
Meantime, the pan-European Task Force On Co-Operation In Greater Europe has called on Nato and Russia to "embrace increased military to military communication, information exchange and transparency measures in the interests of avoiding unintended military engagements".