The Russian president said Kiev must negotiate and make compromises with pro-Russian rebels for the plan to be “viable and realistic”.
Vladimir Putin also said a week-long truce – declared by Ukrainian President Petro Poroshenko – must not be used as an “ultimatum”.
Clashes have continued in eastern Ukraine, with rebel attacks overnight injuring six border guards.
The separatist fighters have dismissed the truce, accusing the Ukrainian army of violating their own ceasefire.
Meanwhile, the US has imposed sanctions – including asset freezes – against seven pro-Russian leaders in Ukraine.
Western leaders have threatened additional sanctions against Russia, which they accuse of stoking tension in Ukraine. Moscow denies the claim.
A statement issued by the Kremlin on Saturday evening said that President Vladimir Putin supported Petro Poroshenko’s ceasefire, “as well as his stated intentions to take a number of concrete steps to achieve a peaceful settlement”.
According to the statement, Vladimir Putin also insisted that the plan would only work if it led to “meaningful negotiations and political compromise between the opposing sides in eastern Ukraine”.
Ukrainian forces have struggled to regain control of buildings and territory that have been seized by the armed separatists in eastern regions bordering Russia.
On Friday night, the separatists attacked three Ukrainian border posts in the Donetsk and Luhansk regions, Kiev said.
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