The Ukrainian military and pro-Russian separatist were engaged in a blame game over the shelling of residential districts of separatist-held Donetsk. This is the first attack on central parts of the city since a February ceasefire agreement.
Late on Saturday, rebels said the attacks had killed one civilian, destroyed buildings and started several fires in the city. More than 6,500 people have been killed since the conflict broke out in eastern Ukraine in April last year.
Attacks have lessened since a peace agreement was brokered in Minsk, Belarus, five months ago, but both sides accuse each other of violations. Ukrainian military observers said they witnessed rebel missile systems "turned towards Donetsk, shelling residential areas of Donetsk, then turning and starting to fire in the direction of Ukrainian positions," Ukrainian General Andriy Taran said in a televised briefing.
Military spokesman Serhiy Galushko said the army had intercepted rebel radio traffic that also suggested separatists planned to shell the city. Senior rebel commander Eduard Basurin denied separatists were responsible for the attacks.
"Last time the centre of Donetsk was hit was in February. I have no explanation. The Ukrainian side says we shelled ourselves. Do you believe we can shell ourselves?," he told Reuters by phone.
The Organization for Security and Cooperation in Europe (OSCE), which is monitoring the ceasefire, has said neither side has fully withdrawn heavy artillery from the frontline as required by the peace deal.
The Ukrainian military said one serviceman had been killed and seven wounded in separatist attacks in the past 24 hours.