President Petro Poroshenko has signed legislation granting Ukraine's cash-starved government the right to stop payments to foreign debt holders.
The presidential press service said on May 28 that the law would come into effect once it was published and remain in force until July 2016.
The Ukrainian cabinet has said the legislation, adopted by parliament last week, is needed to protect "state assets" from "unscrupulous creditors."
Russia says that if Ukraine were to default on its obligations, it would "defend its national interests."
The country holds a $3 billion Ukrainian Eurobond whose full repayment is due by the end of the year.
Ukraine's move comes as it negotiates the terms for restructuring $23 billion worth of foreign debt.
Kyiv hopes to secure the next tranche of a $17.5 billion bailout program with the IMF this summer to shore up its foreign currency reserves.