"While we do not seek confrontation with Russia, its actions in Europe and Eurasia may require the United States to re-examine our force posture in Europe and our requirement for future deployments, exercises, and training in the region," said Assistant Secretary of Defense Derek Chollet.
Some 67,000 US military members are currently stationed on the European continent, mainly in Germany (40,000), Italy (11,000) and Britain (9,500).
When the Soviet Union fell in late 1991, the total presence stood at 285,000.
"Russia's unlawful military intervention in Ukraine challenges our vision of a Europe whole, free and at peace," he said.
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"It changes Europe's security landscape. It causes instability on NATO's borders. And it is a challenge to the international order."
To reassure Eastern European NATO members, Washington has already deployed six F-15s as reinforcement to the Baltics, as well as 12 F-16s and three transport planes to Poland.
The seizure of local administration buildings in Donetsk and Kharkiv in eastern Ukraine was "very concerning," Chollet said, adding that Washington did not believe them to be "spontaneous demonstrations."
"Moving into eastern Ukraine would clearly be a very serious escalation of this crisis," he said.
In his written testimony, Chollet said pressure from Moscow is not confined to Ukraine.
"Moldova, for example, has Russian forces on its territory, nominally peacekeepers, but who actually support the separatist Transnistria region."
NATO's top commander, the US General Philip Breedlove, expressed concern at the end of March about the large Russian troop presence along Ukraine's border, fearing it could lead to an intervention by Moscow in Transnistria.