President Vladimir Putin warned the West he was prepared to use Russia's vast nuclear arsenal to defend its territory, declaring: "It's not a bluff."
"When the territorial integrity of our country is threatened, we will certainly use all the means at our disposal to protect Russia and our people," Mr Putin said in a televised address.
It came as he ordered the mobilisation of 300,000 troops after losing ground in Ukraine's east.
Foreign Minister Penny Wong called on Russia to withdraw from Ukraine.
"We saw Mr Putin making threats to use all means at his disposal," Senator Wong told reporters in New York on Thursday.
"These threats are unthinkable and they are irresponsible. Claims of defending Russia's territorial integrity are untrue."
Ukrainian President Volodymyr Zelenskiy used an address to the United Nations to call for punishment.
"Punishment for the crime of aggression. Punishment for violation of borders and territorial integrity," he said.
"Punishment that must be in place until the internationally recognised border is restored."
Opposition foreign affairs spokesman Simon Birmingham called on the government to provide timely assistance to Ukraine after a request from the under-siege country for more Australian Bushmaster vehicles.
"Australia's response to Ukraine's call for more assistance should come swiftly, positively and generously," Senator Birmingham told reporters in Canberra.
"The Albanese government should make sure that Australia continues to give all we can to assist Ukraine in its military response, which to date has been a heroic defence."
He also rejected the Russian president's comments, saying Australia needed to act with the international community to impose further sanctions.
"President Putin is a menace to the world," Senator Birmingham said.
"His claims that the world has any interest in relation to impinging upon the territories or sovereignty of Russia are fanciful (and) wrong."
The Russian government has tried to formalise its annexation of parts of Ukraine by backing referendums on joining Russia in regions it controls.
However, Senator Wong said Mr Putin's claims of defending Russian territory were false, adding: "No sham referendum will make them true."
Opposition Leader Peter Dutton backed the government's condemnation of the regime, saying the actions of the Russian president needed to be sternly called out.
"The world calling out President Putin, at the moment, is the right thing to do. I hope that continues so that Ukraine can return to peace and to the rebuilding process," he told 2GB radio.
"Sometimes it's inconvenient to be frank and to speak up and to be heard.
"But it's necessary because if we just sit back and pretend that nothing's going to happen, then, as history records, as we've seen in the 1930s, it does lead to war."
Senator Wong has met with nations from the team investigating the downing of Flight MH-17, including the Netherlands, Belgium, Malaysia and Ukraine.
Australia and the Netherlands are pursuing Russia through the International Civil Aviation Organisation for its part in the incident, which killed almost 300 people on board the civilian flight.
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