President Vladimir Putin's order to 150,000 troops to ready themselves for war games near Ukraine was the Kremlin's boldest gesture yet after days of sabre rattling since its ally Yanukovich was ousted at the weekend.
Moscow denied that the previously unannounced drill in its western military district was linked to events in its neighbour country but it came amid a series of increasingly strident statements about the fate of Russian citizens and interests.
With the political turmoil hammering Ukraine's economy, the central bank said it would no longer intervene to shield the hryvnia currency, which tumbled 4% on Wednesday and is now down a fifth since 1 January. Wednesday's abrupt abandonment of Ukraine's currency peg sent ripples to Russia where the rouble fell to five-year lows and bank shares fell.
Yatsenyuk Prime Minister
In Kyiv, leaders of the popular protests that toppled Yanukovich named the current prime minister, Arseny Yatseniuk, as their choice to head the new interim government.
In a display of people power, the so-called 'Euromaidan' council made the announcement, while also naming candidates for several other key ministries, after its members addressed crowds on Independence Square.
Oleksander Turchinov, now the acting president, said the new government would have to take unpopular decisions to head off a default and guarantee a normal life for Ukraine's people.
The Euromaidan council's proposals have to be approved by parliament, which meets on Thursday in an atmosphere heavy with memories of recent bloodshed, whose hundred or so victims are taking on the status of martyrs.
The council named career diplomat Andriy Deshchytsya as foreign minister. Oleksander Shlapak, a former economy minister and former deputy head of the central bank, was named as finance minister. Andriy Paruby, head of the "self-defence" force protecting the Kyiv protest zone from police action during the three months of conflict, was named secretary of the powerful National Security and Defence Council.
"This is a government which is doomed to be able to work only for 3-4 months ... because they will have to take unpopular decisions," Turchinov said.
Speaking to the Euromaidan protesters, Yatsenyuk called his ministers "kamikazes", indicating that they were prepared to to make big personal sacrifices for the common cause with no personal gain. The name 'kamikaze' refers to Japan’s World War II pilots, who trained to perform suicide attacks against enemy naval vessels.
Russia has repeatedly expressed concern for the safety of Russian citizens in Ukraine, using language similar to statements that preceded its invasion of Georgia in 2008.
"In accordance with an order from the president of the Russian Federation, forces of the Western Military District were put on alert at 1400 (1000 GMT) today," Interfax news agency quoted Russian Defence Minister Sergei Shoigu as saying.
Shoigu also said Russia was also "carefully watching what is happening in Crimea" and taking "measures to guarantee the safety of facilities, infrastructure and arsenals of the Black Sea Fleet," in remarks reported by state news agency RIA.
Since Yanukovich's downfall on Friday, all eyes have been on Putin, who ordered the invasion of neighbouring Georgia in 2008 to protect two self-declared independent regions with many ethnic Russians and others holding Russian passports, and then recognised the regions as independent states.
Any military action in Ukraine, a country of 46 million people that has close ties with European powers and the United States, would be far more serious. This is the closest the West and Russia have come to outright confrontation since the Cold War.
Despite the alarm raised by the sabre-rattling, many analysts expect Putin to pull back before taking armed action.
The war games would cause tension in Ukraine and Europe but were probably for show, said Moscow-based military analyst Alexander Golts. "Any rational analysis says that Russia would get nothing out of military intervention - it would become an international outcast," he said.
Armed men seize Crimea parliament
Ukraine's new authorities say they are worried about separatism in the Crimea, the only part of Ukraine where the majority of the population is ethnic Russian.
Armed men have seized the regional government and parliament buildings in Ukraine's Crimea, the scene on Wednesday of a confrontation between pro-Russia separatists and supporters of the country's new leaders, Interfax news agency reported today.
It quoted a local Tatar leader, Refat Chubarov, as saying on Facebook: "I have been told that the buildings of parliament and the council of ministers have been occupied by armed men in uniforms that do not bear any recognisable insignia."
"They have not yet made any demands," he said.
Thousands of ethnic Russians, who form the majority in Crimea, held independence demonstrations on Wednesday. They scuffled with rival demonstrators supporting the new Kyiv authorities. The Crimea is home to part of Russia's Black Sea Fleet, which Moscow said it was taking steps to secure.
Demonstrators poured into the regional capital Simferopol, where the provincial parliament was debating the crisis.
Pro-Russian crowds, some cossacks in silk and lambswool hats, shouted "Crimea is Russian!".
Rival demonstrators backing the new authorities - mainly ethnic Tatars repressed under Soviet rule - rallied under a pale blue flag, shouting "Ukraine! Ukraine!"
One person died in the Crimea protest, apparently of a heart attack during a crush by the crowd, Interfax news agency reported. A Reuters correspondent on the scene reported surging crowds and scuffles but no major violence.