Russian state media said Crimeans voted overwhelmingly to break with Ukraine and join Russia on Sunday, as Kiev accused Moscow of pouring forces into the peninsula and warned separatist leaders "the ground will burn under their feet".
With over half the votes counted, 95.5 percent had chosen the option of annexation by Moscow, the head of the referendum commission, Mikhail Malyshev, said two hours after polls closed. Turnout was 83 percent, he added - a high figure given that many who opposed the move had said they would boycott the vote.
Western powers and leaders in Kiev denounced it as a sham.
"This referendum is contrary to Ukraine's constitution," a White House spokesman said. "The international community will not recognise the results of a poll administered under threats of violence and intimidation from a Russian military intervention that violates international law."
The Kremlin said Putin told Obama the referendum was legitimate and he expressed concern about the Ukrainian government's failure to stamp out violence against Russian speakers in the country.
"Vladimir Vladimirovich Putin drew attention to the inability and unwillingness of the present authorities in Kiev to curb rampant violence by ultra-nationalist and radical groups that destabilise the situation and terrorise civilians, including the Russian-speaking population," the Kremlin said.
It said Putin suggested European monitors should be sent to all parts of Ukraine because of the violence.
Kiev said Moscow's build-up of forces in the Black Sea peninsula was in "crude violation" of an international treaty, and announced plans to arm and train 20,000 members of a newly-created National Guard.
U.S. Secretary of State John Kerry told Moscow that Washington would not accept the outcome of the vote in the region, which has an ethnic Russian majority and was transferred to Ukraine by Soviet rulers only 60 years ago.
The White House also warned Moscow to expect sanctions while foreign ministers from the European Union, which has major trade ties with Russia, will decide on possible similar action in Brussels on Monday.
But Putin rejected Western accusations that the referendum was illegal, saying it respected the will of the Crimean people, while his foreign ministry said it had agreed with the United States to seek a solution to the crisis through constitutional reform.
Many Crimeans hope union with Russia will bring better pay and make them citizens of a country capable of asserting itself on the world stage. But others saw the referendum as a land grab by the Kremlin from Ukraine, whose new rulers want to move the country towards the European Union and away from Russia's sway.
Putin defended the vote in a phone call on Sunday with German Chancellor Angela Merkel, saying it complied with international law, including Article 1 of the U.N. Charter which states the principle of self-determination of peoples. "It was emphasized that Russia will respect the choice of the Crimean people," a Kremlin statement said.
Putin has said he must protect the Russian-speaking population in Ukraine from "fascists" in Kiev who ousted Yanukovich. Western powers largely dismiss his characterisation of the new authorities as successors of Nazi-allied Ukrainian forces which fought the Red Army in World War Two.
Russian Foreign Minister Sergei Lavrov urged Kerry on Sunday to encourage authorities in Kiev to stop what he called "massive lawlessness" against the Russian-speaking population.
In their second phone conversation in two days, Lavrov and Kerry agreed to seek a solution to the crisis by pushing for constitutional reforms in Ukraine, Russia's foreign ministry said in a statement.
However, Kerry told Lavrov that the United States would not accept the referendum result and said Russia must pull back its forces to their bases, a senior State Department official said.
The White House also warned Putin that he faces international isolation that will hurt Russia's economy.
The administration is preparing to identify Russians whom the United States will seek to punish with visa bans and asset freezes that President Obama authorised last week.
At the United Nations, 13 Security Council members voted for a draft resolution on Saturday saying the Crimea result should not be recognised internationally, but Moscow exercised its veto while China abstained.
