Former Ukrainian president Leonid Kuchma told Interfax Ukraine news agency the talks had been "thwarted" after top rebel leaders stayed away and their negotiators refused to discuss a plan for an immediate ceasefire.
Kuchma accused the insurgents' representatives of also putting forward "ultimatums" at the four-hour talks without giving anymore details.
The negotiator for the rebel Donetsk People's Republic, Denis Pushilin, however, blamed Kiev for causing the collapse of the talks and said insurgent leaders would only sign a deal if Kiev's forces halt fire first, Russian news wires reported.
Russian President Vladimir Putin, French President Francois Hollande and German Chancellor Angela Merkel held a three-way phone call, urging the warring factions to agree a ceasefire at peace talks, the Kremlin said.
Fighting is focused on the strategic transport hub of Debaltseve, some 50 kilometres (35 miles) from rebel bastion Donetsk.
Ukaine's defence minister today said the rebels have taken "partial" control of the town, but Kiev denies separatist claims that they have surrounded some 8,000 Ukrainian troops.