The UK will expel Russian diplomats over the county's refusal to extradite Andrei Lugovi to stand trial for the murder of Alexander Litvinenko.
Such a move marks the first time the UK has expelled Russian diplomats in more than a decade and underscores the recent deterioration in relations between the UK and Russia.
The foreign secretary David Miliband stressed Russia is a key international partner and the UK wants to work with the government and its people. But this will require a relationship based on trust and mutual respect, he said.
Mr Miliband confirmed to parliament this afternoon that the UK will expel four diplomats from the Russian embassy in London, alongside other measures.
The expulsion sends a clear and proportionate signal to Russia, the foreign secretary said.
The UK will also reconsider other arrangements with Russia and had already suspended visa negotiations with the former Soviet power.
Mr Miliband also said Mr Lugovi could be extradited to the UK if he travels abroad.
The UK has enjoyed strong support from its allies and Mr Miliband said he will push for this case to be taken into account in future EU-Russian arrangements.
The Conservatives immediately supported the government's stance and Mr Miliband welcomed the cross-party response.
Russia is now expected to impose its own diplomatic measures in retaliation.
Mr Litvinenko died in November last year. The former Russian spy was poisoned with radioactive Polonium 210.
In May, the Crown Prosecution Service decided there was sufficient evidence to bring murder charges against Mr Lugovi, a former KGB officer.
Russia has since refused to cooperate with a request to extradite Mr Lugovi. He has persistently protested his innocence and maintains he has been made a scapegoat.
The UK has declined Russia's offer to try Mr Lugovi in Moscow, citing doubts over the fairness of the trial.
Russia retorted that the UK's stance showed an "offensive" lack of belief in their judicial system.