Moscow - Russia on Friday eyed retaliatory measures against the US after President Barack Obama kicked out dozens of suspected intelligence agents and imposed sanctions in a furious dispute over alleged election interference.
The barrage of punishment against Moscow over cyber attacks dragged ties between Russia and the United States - already at their worst since the Cold War - to a fresh low less than a month ahead of President-elect Donald Trump taking charge.
Making good on a promise to punish Vladimir Putin's government for allegedly trying to tilt the 2016 election in Trump's favour, Obama on Thursday unveiled a broad range of steps that have inflamed tensions with Moscow and the president-elect.
US intelligence had concluded that a hack-and-release of Democratic Party and Hillary Clinton staff emails was ordered by the Kremlin and was designed to put the Republican real estate mogul in the Oval Office.
"I have ordered a number of actions in response to the Russian government's aggressive harassment of US officials and cyber operations aimed at the US election," Obama said in a statement.
In response to the hacks, dubbed "Grizzly Steppe" by US officials, Obama announced sanctions against Russia's military intelligence agency, known as GRU, and the FSB - the KGB's successor.
Obama said 35 Russian "intelligence operatives" based at the Russian embassy in Washington and the consulate in San Francisco have been declared "persona non grata" and ordered to leave the country within 72 hours.
US officials also moved to close two Russian compounds in New York and Maryland, while Obama warned of further covert actions against Moscow.
The Kremlin quickly rejected the US accusations of cyber-interference as "unfounded" and vowed to retaliate.
Kremlin spokesperson Dmitry Peskov accused the Obama administration of trying to "definitively destroy US-Russia relations which have already reached a low."
Relations between Washington and Moscow are at their worst since the end of the Cold War, and Obama has previously imposed sanctions over Russia's actions in Syria and Ukraine.
Peskov said Moscow would "react in an adequate manner based on the principles of reciprocity".
He added, however, that Putin would take into account the fact that Obama only has some three weeks left in office, insisting Moscow would try not to act like a "bull in a china shop" in the hope of normalising ties once Trump takes charge.
Russian foreign ministry spokesperson Maria Zakharova wrote on her Facebook page overnight that "tomorrow there will be official statements, countermeasures and a lot of other things".
US officials said they were aware of reports that Moscow may have ordered the closure of the Anglo-American School in the Russian capital - attended by many children of diplomats - but they could not confirm those reports.
The moves by Obama could also raise further tensions with his successor Trump, who has expressed his admiration for Putin and desire to improve ties with Russia, as the maverick former reality TV star gears up to take over in the White House.
Trump has questioned whether Russia really tipped the electoral scale, painting Obama's accusations as a thinly veiled effort by a Democratic president to delegitimise a Republican victory.
Trump said that while he believes the US should "move on to bigger and better things," he would meet with intelligence leaders next week for a briefing on the situation.
Obama has pointedly stated that "all Americans should be alarmed by Russia's actions."
Obama has also linked the fresh sanctions to harassment of US diplomats in Moscow, which Washington described as "unprecedented" in the post-Cold War era.
US officials played down the impact that sanctions against the GRU and the FSB could have on intelligence-sharing on issues like counterterrorism, saying cooperation was already limited.
Both agencies will face sanctions, along with four individual GRU officers including agency chief Igor Korobov.
In addition, the US Treasury slapped sanctions on two individuals, Evgeniy Bogachev and Aleksey Belan, for "involvement in malicious cyber-enabled activities."
The sanctions freeze any assets they may have in the United States and blocks US companies from doing business with them.
The US government is also declassifying technical information on Russian cyber activity to help companies defend against future attacks.
"The United States and friends and allies around the world must work together to oppose Russia's efforts to undermine established international norms of behaviour and interfere with democratic governance," Obama said.
That reflects growing concerns that Russia could target upcoming elections in France, Germany and the Netherlands.