The Russian Orthodox Church has effectively cut diplomatic relations with the Patriarchate of Constantinople, which has authority over the world's 300 million Orthodox Christians.
It follows signs that Constantinople's Patriarch Bartholomew will recognise Ukraine's Church as independent from Moscow Patriarch, Kirill.
Many Ukrainian Christians reject Kirill's perceived support for Russian-backed rebels in eastern Ukraine.
The Kremlin says it will not interfere.
Spokesman Dmitry Peskov called the reports of an impending split alarming, adding: "Of course for Moscow and indeed for the entire Orthodox world the single preferable scenario is the preservation of unity of this Orthodox world."
Russia sees Kiev as the historic cradle of the Russian Orthodox Church.
The Russian Orthodox church has long held sway over the church in Ukraine, but breakaway churches were set up during Ukraine's brief independence after the fall of the Russian empire and again after communism collapsed in 1991.
Russian Church spokesman Vladimir Legoida said the ruling body, the Holy Synod, had decided to suspend participation in all structures chaired or co-chaired by representatives of the Patriarchate of Constantinople.
It will cease all joint services and Patriarch Kirill will stop mentioning the Patriarch of Constantinople, Bartholomew I, in his prayers, the Synod's decision says.
Metropolitan Hilarion, head of the Russian Church's foreign relations department, described it as "a breakdown of relations".
"To take an example from secular life, the decision is roughly equivalent to cutting diplomatic ties," he was quoted by Ria news agency as saying.