Ukraine Troops Retreat From Key Town Debaltseve
The Ukrainian president says his forces are making an “organised” withdrawal from the embattled town of Debaltseve.
Petro Poroshenko said 80% of Ukraine's troops had left on Wednesday morning, with more to follow.
Fighting has raged over the transport hub, with pro-Russian rebels seizing control of most areas, despite a ceasefire deal.
Russia's foreign minister said Ukrainian forces had been encircled and were forced to battle their way out.
“I'm reckoning that common sense will prevail,” said Sergei Lavrov as he urged the rebels to provide troops who surrendered with food and clothes.
Earlier, US Vice-President Joe Biden accused Russia of violating the accord, agreed in Minsk last week.
Mr Lavrov told reporters that the rebel attack in Debaltseve did not violate the ceasefire agreement, because the town was part of the rebel-held area at the time the peace deal was signed.
Eyewitnesses saw dozens of tanks and columns of weary Ukrainian troops retreating from Debaltseve on Wednesday.
“This morning the Ukrainian armed forces together with the National Guard completed an operation for a planned and organised withdrawal from Debaltseve,” the Ukrainian president said in a statement before travelling to the frontline in the east.
“As of now we can say that 80% of our units have left,” he said.
“We are expecting another two columns (to leave).”
The withdrawal comes after Russian President Vladimir Putin urged Ukraine's troops in Debaltseve to surrender.
Analysis: David Stern, BBC News, Kiev
The rapidly deteriorating situation inside Debaltseve, despite a ceasefire brokered specifically to avoid this scenario, raises a number of questions but one in particular: What were Angela Merkel and Francois Hollande thinking?
Did they receive assurances that the insurgents would observe the ceasefire? Or was the fate of the strategic railroad junction under question even during the Minsk negotiations? If so, why did the Europeans proceed with an agreement that was unenforceable?
It's entirely possible that the Minsk accords have done irreparable damage to the peace process and seriously weakened the position of President Petro Poroshenko. Ukrainian officials may very well be asking what other “exceptions” to the ceasefire will the rebels insist on?
Mrs Merkel and Mr Hollande have long insisted there's no military solution to the war in eastern Ukraine. Now there may not be a diplomatic one either.
International observers monitoring the truce have been unable to enter the town.
It has become a key prize for rebels and government forces, as it sits on a strategic railway line linking rebel-held Donetsk and Luhansk.
Most of its 25,000 population has been evacuated but about 7,000 civilians are still believed trapped by the fighting.
The ceasefire, which came into effect on Sunday, has been broadly observed elsewhere.
Rebel leaders in the so-called Donetsk People's Republic said on Wednesday they had begun to withdraw heavy weaponry from the parts of the frontline where the ceasefire was holding.
The withdrawal was due to start no later than the second day after the truce came into effect and be completed within two weeks, creating buffer zones 50-140km (30-85 miles) wide.
The UN says more than 5,600 people have been killed in the conflict since April, but there are fears the actual death toll could be much higher.