Col. Andriy Lysenko, a spokesman for Ukraine's National Security Council, told reporters Monday he did not have an exact death toll but said dozens of people died, including children, in the rebel shelling.
Andrei Purgin, a self-proclaimed deputy prime minister of the Donetsk separatists, insisted the attack was not by his forces.
"If someone was killed, it wasn't us but the Ukrainian military," he told the Associated Press.
Purgin said he had no information about what happened but said the location named by Ukrainian government in Kiev lies on a road targeted previously by government forces.
Lysenko said the barrage took place Monday morning between the towns of Khryashchuvate and Novosvitlivka, which lie on the main road leading to Russia from the besieged rebel-held city of Luhansk.
"Many people were killed, among them women and children," Lysenko said. "We are not able to count the death toll at this point."
When asked about a rough estimate of deaths, he said: "Dozens."
That road likely would be the one taken by a disputed Russian aid convoy if Ukraine allows it into the country.
Fighting across eastern Ukraine has forced nearly 344,000 people to flee their homes, according to U.N. figures released Friday. The U.N. says about 155,800 have left for other places inside Ukraine while 188,000 more have crossed into Russia.
The flow of refugees only seems to be growing. The U.N. Office for the Coordination of Humanitarian Affairs said more than 22,000 people fled the main rebel-held city of Donetsk last week compared to 6,200 the week before.
City officials have released even higher numbers. Donetsk has seen at least 300,000 of its pre-war population of 1 million leave their homes while Luhansk has only 250,000 of its 420,000 people left, local authorities say.
Residents in Luhansk have had no running water, power or phone connections for 16 days. Basic foods are in short supply, leading to long lines outside shops, city hall said Monday, adding that fighting continues in and around the city.
The International Committee of the Red Cross, which is expected to take responsibility for the Russian aid convoy when it enters Ukraine, has demanded security guarantees from all sides, including the rebels, for the mission into eastern Ukraine. As of Monday, there was no indication that the guarantees had been given.
The humanitarian aid convoy of over 200 trucks from Russia has been watched with suspicion by Ukraine and the West, especially since Ukrainian forces have been winning back significant territory from the rebels in the last few weeks. They suggest it could be used by Russia to send help to the separatists - or to delay the government's advances with a timely cease-fire.
Russia's foreign minister, meanwhile, said he expects the Russian aid mission to enter Ukraine in the near future.
Speaking Monday at news conference in Berlin, where he met a day earlier with his counterparts from Ukraine, France and Germany, Russian Foreign Minister Sergey Lavrov said all questions regarding the mission had been answered and that an agreement had been reached with Ukraine and the ICRC.
It was not clear if Lavrov was referring to the security guarantees.
The fighting in eastern Ukraine began in mid-April, a month after Russia annexed Ukraine's southern peninsula of Crimea.
Jim Heintz in Moscow contributed to this report.