"I deem it necessary to make a decision that should have been made a long time ago - to immediately recognise the independence and sovereignty of the Donetsk People's Republic and the Lugansk People's Republic," Putin said.
A French presidential official said the speech "mixed various considerations of a rigid and paranoid nature".
DIPLOMATIC WINDOW NARROWS
The United States says Russia has massed a force numbering 169,000-190,000 troops in the region, including the separatists in the breakaway regions, and has warned of invasion at any moment.
Putin has for years worked to restore Russia's influence over nations that emerged after the collapse of the Soviet Union, with Ukraine holding an important place in his ambitions. Russia annexed Crimea from Ukraine in 2014.