At least 50 people were reported killed in the last 24 hours, including 16 in a devastating rocket attack on Kramatorsk, the Ukrainian government's eastern military headquarters and administrative hub.
In the rebel stronghold of Donetsk, city officials said that 11 people had been killed, including nine in a mortar strike on the city early today.
Rebels, who rarely announce military casualties, said they had lost seven fighters.
The leaders of Ukraine, Russia, France and Germany were to hold peace talks today aimed at halting a 10-month war in Ukraine where dozens were killed in the latest fighting.
In the run-up to the summit, the climax of a frantic diplomatic push to prevent the worst East-West crisis since the end of the Cold War from escalating, Russia expressed optimism.
"Experts are working, there is noticeable progress," Foreign Minister Sergei Lavrov said, although he signalled there would be no flexibility on the crucial negotiating demand from Ukraine that it be given back control of its border with Russia.
Ukrainian President Petro Poroshenko warned he could "introduce martial law throughout Ukraine" if the talks in the Belarussian capital Minsk failed to stop the war with the pro-Russian separatists.
"I will not hesitate with this decision, if the actions of the aggressor lead to further escalation," he told a cabinet meeting.
Martial law would mark a grave escalation of the crisis, freeing up military resources for the fight in the east but also likely leading to the cutting off of foreign investments, including a vital loan from the International Monetary Fund.
The pro-Western Ukrainian leader said he, French President Francois Hollande and German Chancellor Angela Merkel would speak "with one voice" to Russian President Vladimir Putin, whom they accuse of backing the separatist rebellion.
"The key position is that we need an unconditional ceasefire," he said.
US President Barack Obama has warned Putin that Russia would be made to pay if the talks fail.
A French presidency source said Hollande and Merkel would "try everything" to achieve peace but that hours before the start of the summit at about 2100 IST there were "quite a lot of problems still to be resolved".
Merkel's spokesman said the summit offered "a glimmer of hope, nothing more".
"It is uncertain whether an outcome can be reached, but despite all the uncertainty, it is worth trying in the interest of the suffering people in eastern Ukraine," said Steffen Seibert.
The bloodletting on both sides has been relentless in recent weeks as pro-Russian separatists have pushed a new offensive and Kiev forces have counter attacked.
