Ukrainian forces have withdrawn from the airport of the eastern city of Luhansk after all-night clashes with pro-Russian rebels, the military says.
Security officials said the Ukrainian troops had come under attack from a column of Russian tanks.
Russian Foreign Minister Sergei Lavrov has urged negotiators meeting in the Belarus capital, Minsk, to make an "immediate ceasefire" their priority.
Some 2,600 people have died in eastern Ukraine since fighting began in April.
The conflict broke out after Russia's annexation of Ukraine's southern Crimea peninsula in March.
The rebels have been gaining ground on Ukrainian forces in recent days, in both the Luhansk and Donetsk regions, and further south around the port of Mariupol.
Ukraine and the West blame Russian military support for the rebel advances, saying armoured columns have crossed the border - allegations rejected by Russia's President Vladimir Putin.
He has accused European leaders of ignoring the Ukrainian army "directly targeting civilians".
On Sunday, he said the issue of "statehood" for eastern Ukraine needed to be discussed to ensure the interests of local people were "definitely upheld".
In other developments:
- Nato Secretary General Anders Fogh Rasmussen announced a Readiness Action Plan in response to Russia's "aggressive behaviour", meaning a more visible Nato presence in Eastern Europe and to make Nato "fitter, faster and more flexible to adjust to all kinds of security challenges"
- President Putin urged the European Union to show "common sense" and not to engage in mutually destructive sanctions, in his first reaction to the threat of new sanctions over Ukraine
- German Chancellor Angela Merkel acknowledged that further sanctions against Russia could adversely affect her country's economy, but said "accepting Russia's behaviour [was] not an option"
- Russia's energy minister said Russia and Ukraine had agreed to hold talks on 6 September to resolve the gas crisis, adding that the EU had yet to confirm whether it would send a representative.
'No military intervention'
Ukraine's security council confirmed on Monday that its troops had withdrawn from Luhansk airport "in an organised manner".
Clashes are said to still be taking place near the airport of the city of Donetsk, with separatists claiming that two Ukrainian platoons have surrendered.
Ukrainian news agency UNIAN quoted a senior official as saying that as many as 680 soldiers had been captured in Donetsk region after the recent fighting.
He said "about 80%" of them were captured around Ilovaysk, east of the city of Donetsk, where hundreds of Ukrainian troops have been cut off since the latest rebel advance began.
There were also reports of an attack on a Ukrainian patrol vessel in the Azov Sea on Sunday night.
Meanwhile, Ukrainian and Russian officials are holding talks with separatist rebels and international monitors in Minsk.
The meeting of the so-called Contact Group includes representatives from the Organization for Security and Co-operation in Europe.
Rebel representatives told Russian media they were seeking a "special status" for their regions within Ukraine, leaving them in charge of security and giving them amnesty from prosecution.
The status would "take into consideration the necessity of deepening economic integration with Russia", the rebels say.
Correspondents say what they are demanding would mean the de facto division of the country, as the Ukrainian government is set on closer economic ties to the EU.
Mr Lavrov, meanwhile, said he was counting on the talks to focus on "agreeing an immediate and unconditional ceasefire".
He also insisted there would be "no military intervention" from Russia in Ukraine.
Last week's first direct talks between President Putin and his Ukrainian counterpart, Petro Poroshenko, did not lead to any major breakthrough.
Mr Poroshenko on Monday again accused Russia of "direct and open aggression" in eastern Ukraine.
But Mr Putin earlier said Russia could not "stand aside when people are being shot at almost at point blank".
His comments came after the EU gave Russia a one-week ultimatum to reverse course in Ukraine or face more sanctions.
The EU and US have already imposed asset freezes and travel bans on many senior Russian officials and separatist leaders in eastern Ukraine.
War in eastern Ukraine: The human cost
- At least 2,593 people killed since mid-April (not including 298 passengers and crew of Malaysian Airlines MH17, shot down in the area) - UN report on 29 August
- 951 civilians killed in Donetsk region alone, official regional authorities said on 20 August
- In some particularly dangerous places, such as Luhansk region, victims are said to have been buried informally, making accurate counts difficult
- Rebels (and some military sources) accuse the government of concealing true numbers
- 155,800 people have fled elsewhere in Ukraine while at least 188,000 have gone to Russia