Russia pressed over Ukraine fighting - VIDEO,PHOTOS
Ukraine said Russian forces had crossed the border and were supporting rebel attacks. The rebels have opened a new front near the port of Mariupol.
The US said it suspected a Russian-directed counter-offensive was ongoing.
Russia has repeatedly denied arming or covertly supporting the rebels.
The BBC`s Barbara Plett Usher in Washington says the suspicion is that Moscow is opening a new front to divert Ukrainian forces from the besieged cities of Donetsk and Luhansk, where they have made significant advances against pro-Russian separatists.
However, Denis Pushilin, a rebel leader in Donetsk, told a news conference that Russia was not involved in the current offensive.
"If Russia entered into the war the counter-offensive would already be in Kiev. For now, we do without outside help," he said.
He added that the rebel forces were receiving more volunteers, some from as far away as Serbia.
Reports from journalists and military on the ground suggest that the town of Novoazovsk on the Sea of Azov has been captured by the rebels.
They are now thought to be heading towards the port of Mariupol.
The port has until now been peaceful and cut off from rebel positions.
Rebels have been trying for weeks to break out of an area further north in the Donetsk region where they are almost encircled.
Analysts say the separatists could also be seeking a land link between Russia and Crimea, which also would give them control over the entire Sea of Azov.
Russia annexed the Black Sea peninsula of Crimea from Ukraine in March.
The reports of renewed fighting came just hours after Ukrainian President Petro Poroshenko promised a roadmap for peace in the east.
He spoke after holding his first direct talks on the crisis since June with Mr Putin.
In a phone call with the Russian president, Mrs Merkel said reports of a Russian military incursion into Ukrainian territory had to be cleared up, her spokesman said.
"The latest reports of the presence of Russian soldiers on Ukrainian territory must be explained," said Steffen Seibert.
"She [Mrs Merkel] emphasised Russia`s major responsibility for de-escalation and watching over its own frontiers."
The Kremlin confirmed the phone call but gave no details.
A senior Nato diplomat said Russian support for the separatists was becoming increasingly open.
The diplomat, speaking to reporters in Brussels on condition of anonymity, said: "I think there`s a shift here that we may be witnessing, very recently, from largely covert, ambiguous, deniable support to what appears increasingly to be flat-out, overt and obvious (support) and with the only form of ambiguity being that the Russians... claim it is not happening."