SLOVYANSK, Ukraine -- The well-armed, Moscow-backed insurgency sowing chaos in eastern Ukraine scored a new victory Wednesday, seizing armoured vehicles and weapons from underequipped government forces, then rolling through two cities to a hero's welcome.

Responding to what it sees as Russia's aggression, NATO announced it was increasing its military presence along its eastern border, closest to Russia and Ukraine. And the Obama administration moved to ratchet up its response, preparing new sanctions on Russia and boosted assistance for the struggling Ukrainian military.

Wednesday's setbacks came just 24 hours after a much-touted Ukrainian army operation to retake control of Solvyansk and other cities in the restive east, and appeared to reflect growing indecisiveness by the new Kyiv leadership, which has vowed for days to re-establish its authority there.

With tens of thousands of Russian troops deployed along the border with Ukraine, there are fears the Kremlin might use the instability in the predominantly Russian-speaking region as a pretext for seizing more territory beyond its annexation of Crimea last month.

The day began with throngs of residents in the eastern city of Kramatorsk, some 10 miles (15 kilometres) south of Slovyansk, encircling a column of Ukrainian armoured vehicles carrying several dozen troops. Soon after, masked gunmen in combat gear, wearing the black-and-orange St. George ribbons distinguishing them as pro-Russian militia, reached the site.

Without offering resistance, the Ukrainian soldiers surrendered the vehicles to the militiamen, who sat atop them as they drove them into Slovyansk, Russian flags fluttering in the breeze.

They were greeted by a cheering crowd of some 1,000 people that, although numerous, did not necessarily represent the views of the entire city of 130,000.

One Ukrainian soldier said they had defected to the pro-Russian side, but another suggested they were forced at gunpoint to hand over the vehicles.

"How was I supposed to behave if I had guns pointed at me?" the soldier, who did not identify himself, asked a resident.

Hours later, the Ukrainian Defence Ministry broke its silence, acknowledging the seizure of the military hardware and saying the whereabouts of the Ukrainian soldiers was not known. The Interfax news agency quoted an insurgent leader in Slovyansk, Miroslav Rudenko, as saying the soldiers would be offered the chance to join a local militia or leave the region.

Insurgents in Slovyansk have seized the police headquarters and the administration building, demanding broader autonomy for eastern Ukraine and closer ties with Russia.

Similar seizures have occurred in at least 10 other cities in eastern Ukraine -- and the central government says Moscow is fomenting the unrest in a region that was once the support base for ousted President Viktor Yanukovych, who fled to Russia after months of protests over his rejection of closer relations with the European Union in favour of closer ties with Russia.

Despite the frenzied welcome given the pro-Russian militiamen in Slovyansk, opinions were divided. Some residents were happy with the pro-Russian forces that have now taken effective control over the city.

"We will never allow the fascist Kyiv authorities to come here," said Andrei Bondar, 32, a Slovyansk resident.

But others, like Tetyana Kustova, a 35-year-old sales clerk, were appalled by the unrest.

"They are pushing us toward Russia," she said. "They are tearing Ukraine into pieces."

Later Wednesday, in Pchyolkino, a town south of Slovyansk, several hundred residents surrounded 14 Ukrainian armoured vehicles. Fearing the troops were sent to quell them, the crowd refused to let the vehicles leave despite the pleas of a Ukrainian officer.

They were soon joined by masked pro-Russian gunmen whose sophisticated firearms and battle-readiness have ignited suspicions they, and other militiamen like them, may be troops under direct Russian command.

To end the standoff, leaders in the crowd told their Ukrainian commander, Lt. Colonel Oleksandr Shvets, they would let his 100-strong troops go if they handed over the magazines from their assault rifles. The soldiers removed the magazines, put them in plastic bags and gave them to the pro-Russian militia.

"We are really tired of all of this confusion," said Sgt. Dmytro Mokletsov. "It's really scary giving away the magazines. We have no weapons now. But we were told to, it was an order."

Reflecting the West's concern over the turmoil in Ukraine, German Chancellor Angela Merkel called Russian President Vladimir Putin to discuss the situation and preparations for diplomatic talks Thursday in Geneva on Ukraine.

The Kremlin said Putin told Merkel that "the sharp escalation of the conflict places the country in effect on the verge of a civil war." Merkel's office said she and Putin had "different assessments" of the events in Ukraine.

NATO Secretary General Anders Fogh Rasmussen, meanwhile, said NATO will respond to what he called Russian aggression in Ukraine. NATO aircraft will fly more sorties over the Baltic region and allied ships will deploy to the Baltic Sea, the eastern Mediterranean and elsewhere if needed, he said.

"We will have more planes in the air, more ships on the water and more readiness on the land," Fogh Rasmussen told reporters in Brussels.

Ukraine is not a NATO member but several NATO members -- Lithuania, Latvia, Estonia and Poland -- all border Russia. NATO members Bulgaria, Romania and Turkey also border the Black Sea, along with Russia and Ukraine.

In Washington, officials said they had no plans to levy new sanctions ahead of Thursday's talks in Geneva between the U.S., Russia, Ukraine and the European Union. But with low expectations for a breakthrough in those meetings, officials already have prepared targets for sanctions that include wealthy individuals close to Putin and the entities they run.

The administration also was working on a package of non-lethal assistance for Ukraine's military. The assistance, which was expected to be finalized this week, could include medical supplies and clothing for Ukraine's military, but was expected to stop short of providing body armour and other military-style equipment.

At the United Nations, Assistant Secretary-General for Human Rights Ivan Simonovic warned the Security Council that the violence risks "seriously destabilizing the country as a whole." Western countries on the Security Council said the new report undermines Russia's claims about the events that led to its recent annexation of Crimea, and they warned of a similar situation unfolding now.

Late on Wednesday, pro-Russian gangs launched an assault of a military base on the Black Sea port of Mariupol. The National Guard said in a statement that a mob responded to official refusal to admit them into the base by trying to smash down the gates and firebombing the checkpoint. Local news website 0629.com.ua reported that at least one person in the attacking party died in the ensuing clash.

No official confirmation on casualties was available overnight Wednesday.

In Kyiv, Prime Minister Arseniy Yatsenyuk accused Russia of orchestrating the unrest.

"Russia has got a new export now, apart from oil and gas: Russia is now exporting terrorism to Ukraine," Yatsenyuk told a Cabinet meeting. "Russia must withdraw its sabotage groups, condemn terrorists and liberate all administrative buildings."

Associated Press writers Peter Leonard in Donetsk, Maria Danilova and Nataliya Vasilyeva in Kyiv, Laura Mills in Moscow and Juergen Baetz and John-Thor Dahlburg in Brussels contributed to this report.