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One US official said Washington strongly suspected the Malaysian Airlines Boeing 777 was downed by a sophisticated surface-to-air missile fired by Ukrainian separatists backed by Moscow.
There were no survivors from the crash, which left wreckage and bodies scattered across miles of rebel-held territory.
The scale of the disaster could prove a turning point for international pressure to resolve the crisis in Ukraine, which has killed hundreds since protests toppled the Moscow-backed president in Kiev in February and Russia annexed the Crimea a month later.
The United States called for an immediate ceasefire to allow easy access to the crash site, while pro-Russian separatists told the Organization for Security and Co-operation in Europe (OSCE), a security and rights body, they would ensure safe access for international experts visiting the scene.
The plane crashed about 40km from the border with Russia near the regional capital of Donetsk, an area that is a stronghold of rebels who have been fighting Ukrainian government forces.
Leaders of the rebel Donetsk People's Republic denied any involvement and said a Ukrainian air force jet had brought down the intercontinental flight.
Reuters journalists saw burning and charred wreckage bearing the red and blue Malaysia Airlines insignia and dozens of bodies in fields near the village of Hrabove.
"While we do not yet have all the facts, we do know that this incident occurred in the context of a crisis in Ukraine that is fuelled by Russian support for the separatists, including through arms, materiel, and training," White House spokesman Josh Earnest said in a statement.
US Vice President Joe Biden said it appeared the downing of the jetliner was not an accident and that it apparently was "blown out of the sky".
Australian Prime Minister Tony Abbott appeared to go further than other Western leaders in apportioning blame, demanding that Moscow answer questions about the "Russian-backed rebels" that he said were behind the disaster.
More than 20 Australians were among the many nationalities aboard Malaysia Airlines Flight MH17. The Netherlands was the worst affected, with 154 Dutch citizens on the downed plane.
A number of those on board were travelling to an international AIDS conference in Melbourne, including Joep Lange, an influential Dutch expert.
"TRAGIC DAY, TRAGIC YEAR"
An emergency worker said at least 100 bodies had been found so far and that debris was spread over 15km. The airline said it was carrying 283 passengers and 15 crew.
"I was working in the field on my tractor when I heard the sound of a plane and then a bang," one local man told Reuters at Hrabove, known in Russian as Grabovo. "Then I saw the plane hit the ground and break in two. There was thick black smoke."
The loss of MH17 is the second devastating blow for Malaysia Airlines this year, following the mysterious disappearance of Flight MH370 in March, which vanished with 239 passengers and crew on board on its way from Kuala Lumpur to Beijing.
In Malaysia, there was a sense of disbelief that another airline disaster could strike so soon.
"If it transpires that the plane was indeed shot down, we insist that the perpetrators must swiftly be brought to justice," Malaysian Prime Minister Najib Razak told a pre-dawn news conference in Kuala Lumpur.
"This is a tragic day, in what has already been a tragic year, for Malaysia."
At the airport in Kuala Lumpur, relatives of those aboard gathered, hoping for word.
Akma Mohammad Noor said her sister, Rahimah, was on the flight, coming home for the first time in years to mark the Muslim festival of the end of Ramadan.
"We were supposed to celebrate," Noor said, weeping.
Ukraine accused pro-Moscow militants, aided by Russian military intelligence officers, of firing a long-range, Soviet-era SA-11 ground-to-air missile.
Russian President Vladimir Putin - at loggerheads with the West over his policies toward Ukraine - pinned the blame on Kiev for renewing its offensive against rebels two weeks ago after a ceasefire failed to hold. The Kremlin leader called it a "tragedy" but did not say who brought the Boeing 777 down.
US President Barack Obama, who spoke to Dutch Prime Minister Mark Rutte as well as other leaders, said evidence from the crash must remain in Ukraine so international investigators have a chance to look at all of it, officials said.
The White House said the United States was willing to contribute immediate assistance to the investigation, and CNN reported that FBI and National Transportation Safety Board (NTSB) officials would be heading to Ukraine in an advisory role.
The OSCE said in a statement on its website that a "contact group" of senior representatives from Ukraine, Russia and the OSCE had held a video conference with the separatists, who pledged to co-operate with Ukrainian authorities in the investigation.
Kiev complained that separatists prevented Ukrainian officials from reaching the site.
Pro-Russian separatists in the region said on Thursday they had found one of the "black box" recorders.
Rescue workers recovered a second flight recorder on Friday, a Reuters cameraman on the scene said.
U.N. Secretary-General Ban Ki-moon also called for a transparent international investigation. The U.N. Security Council will discuss the issue on Friday.
Ukrainian President Petro Poroshenko, who had stepped up an offensive in the east, spoke to Obama and sought to rally world opinion behind his cause.
"The external aggression against Ukraine is not just our problem but a threat to European and global security," he said in a statement.
Russia, which Western powers accuse of trying to destabilise Ukraine to maintain influence over its old Soviet empire, has accused Kiev's leaders of mounting a fascist coup. It says it is holding troops in readiness to protect Russian-speakers in the east - the same rationale it used for taking over Crimea.
News of the disaster came as Obama was on the phone with Putin, discussing a new round of economic sanctions that Washington and its allies have imposed to try to force Putin to do more to curb the revolt against the new government in Kiev.
Obama warned of further sanctions if Moscow did not change course in Ukraine, the White House said.
The Netherlands declared a day of national mourning for its 154 dead. Twenty-eight passengers were Malaysian, 28 Australian, 12 Indonesian, nine British, four German, four Belgian, three Filipino and one each from Canada and New Zealand. All 15 crew were Malaysian. Nationalities of the others aboard were unclear.
Ukrainian officials accused rebels of using a Soviet-era SA-11 missile system acquired from Russia.
After the downing of several Ukrainian military aircraft in the area in recent months, including two this week, Kiev had accused Russian forces of playing a direct role.
Separatists were quoted in Russian media last month saying they had acquired a long-range SA-11 anti-aircraft system.
International air lanes had been open in the area, although only above 32,000 ft (9,750 metres). The Malaysia plane was flying 1,000 ft higher, officials said. The area was closed to flights afterwards.
Some international airlines, including Australia's Qantas Airways and Korea's two major carriers, shifted the route taken by flights operating over Ukrainian air space months ago amid increasing tensions between Kiev and pro-Moscow rebels.
The U.S. Federal Aviation Administration issued an order prohibiting American aircraft from flying over eastern Ukraine.