A security service officer was abducted by unknown gunmen and taken across the border to Russia, Estonia has claimed.
But Russia said the man was detained on its territory and suspected of being a spy.
The incident came at a time of heightened tensions between the two countries. Only two days earlier, US President Barack Obama visited Estonia and gave the Nato member assurances of protection from any Russian threat.
The Estonian internal security service said the officer was investigating cross-border crime when he was abducted at gunpoint on Estonian territory near the Luhamaa border checkpoint.
The Russian federal security service (FSS) said the Estonian was detained in the Pskov region of Russia - a claim that the Estonian security service denied.
He was carrying "a Taurus handgun with cartridges, 5,000 euros in cash, special equipment for concealed audio recording and materials that indicated an intelligence mission," the FSS said.
Arnold Sinisalu, the director of Estonia's security service told the Estonian national broadcaster ERR that the officer was Eston Kohver - a decorated police officer and an expert in the field of terrorism and extremist action prevention.
The Estonian foreign ministry said it summoned Russia's ambassador in connection with the incident, which it called "disturbing".
Foreign Minister Urmas Paet said Estonia expects "to receive all manner of co-operation necessary from Russia in solving this case and bringing the Estonian citizen back to Estonia".