The Ukrainian government says it is suspending its preparations to sign a landmark association agreement with the European Union.
Instead, the government said in a statement posted on its website that it is setting up a commission to work on boosting ties between Ukraine, Russia and the EU.
The move follows the parliament’s refusal earlier on Thursday to pass a bill allowing the release of jailed former Prime Minister Yulia Tymoshenko, a key EU condition for signing the deal.
It also dealt a harsh blow to Ukraine’s hope to integrate with the 28-member bloc and move out of Russia’s shadow.
Members of President Viktor Yanukovych’s Party of Regions did not vote in favour of even one of the six bills meant to allow Ms Tymosehnko’s release ahead of a Ukraine-EU summit next week.
Opposition members of parliament responded with chants of “Shame! Shame!”.
Russia wants Ukraine to join its own customs union with Kazakhstan and Belarus, which it sees as a prototype rival to the European Union.