Rebels have promised to honour a cease-fire declared by the Ukrainian president and engage in more talks to help resolve the conflict.
The announcement came on the first day of talks between a former Ukrainian president, the Russian ambassador, European officials and the eastern separatists who have declared independence.
The negotiations were launched in line with President Petro Poroshenko's peace plan, which started with a weeklong unilateral cease-fire last Friday to uproot the mutiny that has engulfed the nation's industrial east. Hundreds of people have been killed in the fighting and tens of thousands have fled their homes.
Alexander Borodai, one of the rebel leaders who took part in last night's talks in Donetsk, said they would respect the cease-fire declared by Mr Poroshenko, which lasts until 7am on Friday.
The rebels, who have declared their border regions independent and fought government troops for two months, also promised to release the observers from the Organisation for Security and Cooperation in Europe whom they have held hostage.
President Putin, meanwhile, spoke on the phone yesterday with President Obama, urging direct talks between warring parties in Ukraine.
The Kremlin said Putin underlined in yesterday's conversation that in order to normalise the situation in eastern Ukraine it's necessary to "effectively end fighting and start direct talks between the conflicting parties."
Yesterday's talks involved Ukraine's ex-President Leonid Kuchma, the Russian ambassador to Ukraine and an envoy from the OSCE.
Poroshenko has ruled out talks with those he calls "terrorists," so inviting Kuchma to mediate offered a way to conduct talks without the government's formal engagement.
Ukraine and the West have accused Russia of fomenting the rebellion in the east by sending troops and weapons across the border, but Moscow has denied that and insisted that Russian citizens who joined the insurgents were volunteers.
The Ukrainian government has accused the rebels of firing at government forces' positions since the unilateral cease-fire was announced, while insurgents have accused the Ukrainian forces of failing to observe it. Poroshenko has said that government troops will fire back if attacked.
Poroshenko's office said that he had offered Russia a chance to send observers to join the OSCE mission in Ukraine to see that government troops were observing the cease-fire.
Kuchma, who served as president from 1994-2005, comes from the east and is an astute political player respected by both sides. His ex-chief of staff, Viktor Medvedchuk, has lived in Russia and reportedly has close ties to Putin, was also at the talks.
Putin publicly expressed support for Ukraine's declaration of a cease-fire and urged both sides to negotiate a compromise, which must guarantee the rights of the Russian-speaking residents of eastern Ukraine.
Putin clearly intends to maintain pressure on the Ukrainian government in Kiev to give the country's eastern industrial regions more powers, which would allow them to keep close ties with Russia and serve the Kremlin's main goal of preventing Ukraine from joining NATO.
But the Russian leader also wants to avoid more crippling sanctions from the US and particularly from the EU, whose leaders will meet Friday in Brussels, and therefore needs to be seen as cooperating with efforts to de-escalate the conflict.