Russian President Vladimir Putin has said Moscow is preparing to take retaliatory measures if the US builds missile defence systems in Europe.
Mr Putin says US missile defence plans may spark another arms race
He described as non-existent the threat from Iran that Washington says the new system is designed to counter, suggesting it might be aimed at Russia.
Last week, Russia said it had tested a ballistic missile to maintain "strategic balance" in the world.
The US says the system, to be placed in eastern Europe, is not aimed at Russia.
Washington wants to deploy interceptor rockets in Poland and a radar base in the Czech Republic to counter what it describes as a potential threat from "rogue states" such as Iran and North Korea.
'Not our fault'
Mr Putin made his comments in an interview with foreign reporters ahead of the G8 meeting that starts in Germany on Wednesday.
US President George W Bush is due to meet him at the three-day summit in the resort of Heiligendamm.
The BBC's Rupert Wingfield-Hayes in Moscow says if Mr Putin's words are anything to go by the summit is likely to be stormy.
Mr Putin said he hoped US officials would change their minds about the missile defence plan.
"If this doesn't happen, then we disclaim responsibility for our retaliatory steps, because it is not we who are the initiators of the new arms race which is undoubtedly brewing in Europe," he said.
Mr Putin said neither Iran nor North Korea had the weapons that the system was intended to shoot down.
"We are being told the anti-missile defence system is targeted against something that does not exist. Doesn't it seem funny to you?" he asked.
Meanwhile top Iranian security official Ali Larijani described the planned deployment as the "joke of the year", adding that Iranian missiles were not capable of reaching Europe.
Mr Putin said a new arms race would be the fault of the US.
He said Washington had "altered the strategic balance" by unilaterally pulling out of the anti-ballistic missile (ABM) treaty in 2002.
"If the American nuclear potential grows in European territory, we will have to have new targets in Europe," Mr Putin said.
"It is up to our military to define these targets, in addition to defining the choice between ballistic and cruise missiles."
Last Tuesday, Russia tested an RS-24 missile that successfully struck its target 5,500km (3,400 miles) away.
It was designed to evade missile defence systems, Russia's defence ministry said.
Mr Putin went on to accuse the West of hypocrisy in criticising Russia's human rights record.
He said the US was the main violator of freedoms and human rights around the world and that France, Germany and Britain had problems of their own.
Finally he accused Britain of foolishness in trying to extradite former KGB officer Andrei Lugovoi for the murder of Alexander Litvinenko, another former KGB agent and a critic of Mr Putin.