Ukrainian president Petro Poroshenko has signed a decree introducing martial law following naval clashes between Ukraine and Russia.
Reuters reports the martial law decree is subject to parliamentary approval.
A statement on Poroshenko's website says martial law "does not mean the declaration of war, it is exclusively for the defense of Ukraine".
The move comes after Russia’s coastguard opened fire on and seized three Ukrainian vessels on Sunday.
Two crew members were injured in the incident, which followed after a tense standoff in the Black Sea near the Crimean Peninsula, the Ukrainian navy said.
Protests erupted outside the Russian embassy in Kiev following the incident, with a Russian diplomat's car set on fire.
An emergency meeting of the United Nations Security Council was held on Monday to discuss the escalating situation.
The European Union and NATO called for restraint from both sides and for Moscow to restore access to the strait, which Ukraine uses to move ships to and from ports on either side of the peninsula.
Russia blamed Ukraine for provoking the incident, which sharply escalated tensions that have been growing between the two countries since Moscow annexed Crimea from Ukraine in 2014.
Earlier in the day, Russia and Ukraine traded accusations over a separate incident involving the same vessels, prompting Moscow to block passage through the narrow Kerch Strait, which separates the peninsula from the Russian mainland.
The Ukrainian navy said two of its gunboats were struck and Russian crews boarded and seized them and an accompanying tugboat.
Around 100 people gathered outside the Russian Embassy in Kiev to protest Moscow’s actions, throwing smoke grenades and setting fires.
Russia’s Federal Security Service, known as the FSB and which oversees the coast guard, said there was “irrefutable evidence that Kiev prepared and orchestrated provocations...in the Black Sea”, adding: “These materials will soon be made public.”
The FSB confirmed early on Monday that it fired on the vessels to force them to stop, and then seized them.
Ukrainian authorities said they had given advance notice to the Russians that the vessels would be moving through the strait, which connects the Black Sea to the Sea of Azov.
Russia said the three Ukrainian vessels made an unauthorised passage through Russian territorial waters, while Ukraine alleged that one of its boats was rammed by a Russian coastguard vessel.
The tugboat, which was rammed, was travelling with the two Ukrainian gunboats from Odessa on the Black Sea to Mariupol, an eastern Ukraine port, via the Kerch Strait.
“Russian coast guard vessels … carried out openly aggressive actions against Ukrainian navy ships,” the Ukrainian statement said, with the tugboat suffering damage to its engine, hull, side railing and a lifeboat.
The Kerch Strait is the only passage into the Sea of Azov. The strait is spanned by the recently completed Kerch Bridge, connecting Crimea to Russia. Transit under the bridge has been blocked by a tanker ship, and dozens of cargo ships awaiting passage are stuck.
Russia has not given any indication of how long it will block the strait, but a long-term closure would amount to an economic blockade of Ukrainian cities on the Azov coast. Russia’s Black Sea Fleet greatly outmatches the Ukrainian navy.
Ukrainian ports on the Sea of Azov include strategically vital centres such as Mariupol, the closest government-controlled city to Donetsk and Luhansk, the breakaway regions of eastern Ukraine controlled by Russia-backed separatists. Thousands of people in those regions have been killed in fighting between Ukrainian troops and the separatists since 2014.
The FSB told Russian news agencies after the first incident that the Ukrainian ships held their course and violated Russian territorial waters.
“Their goal is clear — to create a conflict situation in the region,” the FSB statement said. It did not mention that a Ukrainian tugboat was rammed.
Although a 2003 treaty designates the Kerch Strait and Sea of Azov as shared territorial waters, Russia has been asserting greater control over the passage since 2015.