The UK on Wednesday denied a claim from Moscow that a Russian warship fired warning shots at a British destroyer in the Black Sea.
Russia claimed it fired shots from a patrol boat and dropped bombs in the path of HMS Defender to force it from disputed waters near Crimea.
It said the warship had intruded into what the Kremlin regards as Russian waters near the peninsula.
Such a confrontation would be a significant escalation in tension between Moscow and the West.
But the UK’s Ministry of Defence said there was no warning shot and that the Russian gunshots were part of a military exercise.
"No shots were directed at HMS Defender and we do not recognise the claim that bombs were dropped in her path," it said.
“We believe the Russians were undertaking a gunnery exercise in the Black Sea and provided the maritime community with prior warning of their activity.”
Russia annexed Ukraine’s Crimean Peninsula in 2014, a move not recognised by most of the international community.
It claimed HMS Defender strayed three kilometres into its territory near Cape Fiolent, a landmark on the Crimean coast.
UK Defence Secretary Ben Wallace said the ship sailed through an international corridor on its way from Odessa to Georgia.
“As is routine, Russian vessels shadowed her passage and she was made aware of training exercises in her wider vicinity,” he said.
Speaking later to a parliamentary committee, he said: “These are the things that come and go with Russia. Disinformation, misinformation is something that we have seen regularly.”
Tracking website Marine Traffic showed the ship passing south of a Russian naval base in Sevastopol, home of the Russian navy’s Black Sea fleet.
Moscow claimed a Russian patrol ship fired its gun and an Su-24 bomber dropped bombs in front of the British ship.
“The destroyer had been warned that weapons would be used if it trespasses the border of the Russian Federation. It did not react to the warning,” the Russian Defence Ministry said.
The Associated Press reported that such a confrontation would be the first time since the Cold War on which Moscow used live ammunition to deter a Nato warship.
Russian ministry spokeswoman Maria Zakharova denounced the alleged intrusion as a “rude British provocation that defies international law”.
The ministry said it had summoned the UK’s military attache in Moscow and urged Britain to investigate the crew’s actions.
Nato's Secretary General Jens Stoltenberg said at a summit of alliance leaders last week that relations with Russia were at their lowest point since the Cold War.
As well as tension over Ukraine, relations are strained over alleged Russian cyber attacks and Moscow’s treatment of opposition figure Alexei Navalny.
Moscow has frequently criticised Nato warships’ visits to the Black Sea, describing their presence as “destabilising”.
Western countries consider the Crimean peninsula part of Ukraine and reject Russia’s claim to the seas around it.
Nato members Turkey, Greece, Romania and Bulgaria all are on the Black Sea.
HMS Defender was carrying out Nato missions in the Black Sea, having previously been part of the UK's Carrier Strike Group in the Mediterranean.
As part of the group, it was taking part in the maiden deployment of the UK's new aircraft carrier HMS Queen Elizabeth.
It left to team up with Dutch frigate HNLMS Evertsen and sail to the Black Sea for training exercises and visits to the ports of Nato allies.
During its journey, UK defence officials signed a new agreement with Ukraine aimed at boosting Kiev’s naval capabilities.
The memorandum was signed on board HMS Defender and envisaged training for Ukrainian naval personnel as well as the creation of new naval bases.
“The UK and Ukraine have a close defence relationship and we continue to strengthen this partnership to help deter shared threats,” Britain’s Defence Procurement Minister Jeremy Quin said.