The strong-arm leader intends on bringing not only the regions of Ukraine that neighbour Russia under his control, Liz Truss said, but there are "strong signs" he is also seeking to capture the capital Kyiv.
And "he won't just stop at Ukraine," Ms Truss said, "he has also talked about turning the clock back to the 1990s where Russia had control of vast swathes of eastern Europe".
Boris Johnson at PMQs announced the UK would be sending further military aid to Ukraine "in light of the increasingly threatening behaviour" from Russia.
"This will include lethal aid in the form of defensive weapons and non-lethal aid," he added.
Downing Street would not give further details on the military equipment being provided to Ukraine for "security reasons" although it is understood no British personnel will be sent.
In comments likely to inflame Mr Putin, Defence Secretary Ben Wallace said the president had gone "full Tonto" but the UK had "kicked the backside" of Russia in the past and "can always do it again".
Defence Secretary Ben Wallace: 'He's gone full Tonto'
The UK, EU and US all announced sanctions on Russia after it made an incursion into separatist regions of Ukraine, but Mr Johnson was criticised for not going as far as his international partners.
Britain slapped five Russian banks with sanctions and three wealthy Russian individuals had their UK assets frozen along with being banned from entering the country - but the EU sanctions included 351 members of the Russian parliament.
At PMQs the prime minister has said "even more" sanctions against Russia are coming when pressed to "unleash a full package" of measures by Labour Leader Sir Keir Starmer.
The Labour leader also urged Mr Johnson to ask regulator Ofcom to review whether President Putin's "personal propaganda tool", Russia Today, should be allowed to broadcast in the UK.
The PM said Culture Secretary Nadine Dorries had already asked the regulator to review the operation of the news channel.
Foreign Secretary Truss told ITV News the UK is planning to follow the EU in sanctioning Russian politicians who voted in favour of the recognition of the breakaway regions.
"We will be targeting more individuals," she said, but officials are making sure the sanctions are "legally watertight".
She added: "What we wanted to do is make sure we had some sanctions left in the locker to inflict more pain on Vladimir Putin and his regime if there is a full-scale invasion.
"We think that invasion is highly likely so that full package of sanctions is highly likely to be put on."
Mr Johnson is likely to come under fire in the Commons on Wednesday over the punishment doled out to Kremlin-linked oligarchs and banks by the government in response to Russian aggression.
Writing in The Times, Ms Truss said she had held a call with G7 allies to “agree the next package” of sanctions, while No 10 insisted there was more to come if Russia did not back down from manoeuvres in eastern Ukraine where troops had been sent into the Donbas region under the guise of being “peacekeepers”.
But the prime minister faced criticism from all sides for not going far enough when he announced his clutch of measures on Tuesday.
Mr Johnson announced three billionaire allies of the Russian president and five Russian banks would face punitive measures.
Ms Truss said the Russia-Ukraine crisis "could go on, I'm afraid to say, for years," and a takeover of Ukraine "is not going to be easy" because Ukrainians are "ready to fight".
Calls have also been held between UK ministers and their counterparts in Baltic states which may feel under threat by Russia’s actions, as the US sent troops already stationed in Europe to Estonia, Latvia and Lithuania in what was called a “defensive” move.
ITV News Europe Editor James Mates explains what impact the Western unity in threatening sanctions on Russia has had on President Putin
But the British sanctions offering was branded as “gruel” by the Liberal Democrats’ Layla Moran, and Labour leader Sir Keir Starmer said “we must be prepared to go further”.
On his own benches, Mr Johnson was told by former Prime Minister Theresa May that “the battle in which we must now engage is nothing more or less than the defence of democracy itself”.
Former Foreign Secretary Jeremy Hunt warned “Putin will have predicted and discounted western sanctions long ago, so does he (Mr Johnson) agree that if we are not to be behind in the diplomatic chess game, we need to do some things that he is not expecting?”
Tobias Ellwood, Conservative chairman of the Defence Committee, said: “Sanctions alone will not be enough, indeed untargeted sanctions may play into Putin’s plan to pivot Russia ever closer to China”.
Conservative former minister Mark Harper asked for assurances that Boris Johnson will implement “further and stronger measures even if President Putin does no more”.
In the Lords, former Navy chief Lord West of Spithead said the UK and US should be preparing to make Putin’s “eyes water”.
The Labour peer, a member of Parliament’s Intelligence and Security Committee, said Putin had “made a calculation the pain isn’t that much and I have to say at the moment I would rather agree with him. He’s not getting that much pain”.
However, Mr Johnson and Downing Street insisted this was only the “first barrage” of measures, where “very high net wealth individuals” Gennady Timchenko, Boris Rotenberg and Igor Rotenberg – who he described as “cronies” of the Russian president – were targeted.
The sanctions, which include UK asset freezes, a travel ban and prohibition on British individuals and businesses dealing with them, were also tabled against Russian banks Rossiya, IS Bank, General Bank, Promsvyazbank and the Black Sea Bank.
But Tom Keatinge, the director of the Centre for Financial Crime and Security Studies at the The Royal United Services Institute (RUSI) said the measures were “essentially taking a peashooter to a gunfight”.
Ms Truss said Britain will “use every lever at our disposal to stop (Putin) in his tracks”.
Writing in The Times, Ms Truss said: “Nothing is off the table”.
She said: “We have a long list of those complicit in the actions of the Russian leadership. Should Russia refuse to pull back its troops we can keep turning up the heat, targeting more banks, elites and companies of significance”.