British Prime Minister Boris Johnson told an emergency national security meeting on Tuesday that Russia's Vladimir Putin seems to be "bent on full-scale invasion" of Ukraine, the BBC's political editor reported.
Laura Kuenssberg added that the first "barrage of economic sanctions" would be set out in the House of Commons around 1230 GMT. Johnson was chairing a meeting of the national security committee early on Tuesday.
Russian President Vladimir Putin ordered the deployment of troops to two breakaway regions in eastern Ukraine after recognizing them as independent on Monday, accelerating a crisis the West fears could unleash a major war.
A Reuters witness saw tanks and other military hardware moving through the separatist-controlled city of Donetsk after Putin formally recognized the breakaway regions and ordered the deployment of Russian forces to "keep the peace."
"You can conclude that the invasion of Ukraine has begun," British Health Secretary Sajid Javid told Sky News. "The Russians, President Putin, has decided to attack the sovereignty of Ukraine and its territorial integrity."
"We will be introducing sanctions as we said we always will," he said.
"We've always preferred dialog and still continue to do so but it's clear from President Putin's actions that he has chosen confrontation over dialog," Javid told BBC TV.
Britain has threatened to cut off Russian companies' access to US dollars and British pounds, blocking them from raising capital in London and exposing what Johnson calls the "Russian doll" of property and company ownership.
Britain has not yet spelled out who would fall under the sanctions but has pledged that there would be nowhere for Russian oligarchs to hide. Johnson has said targets could include Russian banks.
Javid said sanctions will be announced in a statement to parliament by Johnson.
"I'm sure that we'll make those sanctions as targeted as possible to the people that are responsible for this flagrant violation of international law," Javid said.