Pro-Russian separatists in eastern Ukraine have ignored a new ceasefire, saying it did not apply to the town where most fighting has taken place in recent weeks.
Guns fell abruptly silent at midnight across much of eastern Ukraine in line with the ceasefire agreement, reached after a week of diplomacy led by France and Germany.
But pro-Russian rebels announced they would not observe the truce at Debaltseve, where Ukrainian army forces were encircled.
Ukrainian military officials said rebel attacks on the town steadily increased from mid-afternoon.
"Of course we can open fire (on Debaltseve). It is our territory," senior rebel commander Eduard Basurin told Reuters.
"The territory is internal: ours. And internal is internal. But along the line of confrontation there is no shooting."
A statement by the Ukraine military said the "enemy" was carrying out attacks with varied types of weapons, including Grad rocket systems, and had a plan to try to seize Debaltseve from the west.
In a four-way telephone conversation with the leaders of Germany, France and Russia, Ukrainian President Petro Poroshenko said the position of the four at peace talks last week in Belarus had been for a ceasefire on all the frontlines including at Debaltseve.
Mr Poroshenko stressed that a withdrawal of military equipment and heavy weapons required a "full and unconditional" ceasefire under the Minsk agreement.
The Organisation for Security and Cooperation in Europe, responsible for monitoring the ceasefire, said rebels had denied its observers access to Debaltseve.
A rebel fighter at a checkpoint on a road from Donetsk to government-held Dnipropetrovsk, said he did not expect the ceasefire to hold.
"Truce? I doubt it. Maybe two to three days, and then they will start shooting again. This is all for show. The OSCE is driving around here, so of course they are being quiet."
Both sides blamed what firing there was on the enemy.
Kremlin spokesman Dmitry Peskov said the peace deal including the truce must be implemented "unconditionally".
But he made no mention of whether Russia believed the truce applied to Debaltseve.
Ukrainian forces have for weeks been holding out in the town, which sits on a railway junction in a pocket between the two main rebel strongholds.
Rebels say they have completely encircled the town, but Ukraine says its forces have kept open a road to resupply it in the face of a Russian-backed onslaught.
Washington says regular Russian forces armed with tanks and missile launchers advanced on the town from all sides in the days before the truce.
Reuters journalists operating on the rebel side have seen armoured columns of troops without insignia arriving in the area in recent days.
In the main rebel centre, Donetsk, Reuters journalists said artillery had been exploding every few seconds in the hours before the ceasefire, but halted abruptly at midnight.
A Ukrainian military spokesman said the ceasefire was being "generally observed".
Its forces had been shelled ten times since the truce took effect in localised incidents, and no soldiers had been killed.
The ceasefire aims to create the conditions for a buffer zone and withdrawal of heavy weapons.
More than 5,000 people have been killed in the conflict that has caused the worst crisis in Russia-West relations since the Cold War.
