* U.S., EU sanctions small group of Russians and Ukrainians
* Obama says ready for further steps but diplomacy still possible
* Russia wants "support group" to make Ukraine neutral
* Putin says Kiev failing to protect Russian speakers
* Ukraine military mobilising, fearing invasion in east
By Aleksandar Vasovic and Adrian Croft
SIMFEROPOL/BRUSSELS, March 17 (Reuters) - The United States and the European Union imposed sanctions including asset freezes and travel bans on a small group of officials from Russia and Ukraine after Crimea applied to join Russia on Monday following a weekend referendum.
Crimea's leaders declared a Soviet-style 97-percent result in favour of seceding from Ukraine in a vote condemned as illegal by Kiev and the West.
The Crimean parliament formally proposed that Russia "admit the Republic of Crimea as a new subject with the status of a republic". Russian President Vladimir Putin will address a special joint session of the Russian parliament on the issue on Tuesday, aides said.
The move would dismember Ukraine against its will, escalating the most serious East-West crisis since the end of the Cold War.
Russian forces took control of Crimea in late February following the toppling of Ukrainian president Viktor Yanukovich after deadly clashes between riot police and protestors trying to overturn his decision to spurn a trade and cooperation deal with the EU and seek closer ties with Russia.
U.S. President Barack Obama imposed sanctions on 11 Russians and Ukrainians blamed for the military seizure, including Yanukovich, and Vladislav Surkov and Sergei Glazyev, two aides to Putin.
Putin himself, suspected in the West of trying to resurrect as much as possible of the former Soviet Union under Russian leadership, was not on the blacklist.
Amid fears that Russia might move into eastern Ukraine, Obama warned Moscow at a White House press briefing that what he called further provocations would only increase Russia's isolation and exact a greater toll on its economy.
"If Russia continues to interfere in Ukraine, we stand ready to impose further sanctions," he said.
A senior U.S. official said Obama's order cleared the way to sanction people associated with the arms industry and targets "the personal wealth of cronies" of the Russian leadership.
In Brussels, the EU's 28 foreign ministers agreed to subject 21 Russian and Ukrainian officials to visa restrictions and asset freezes for their roles in the events.
The EU did not immediately publish the names. Washington and Brussels said more measures could follow in the coming days if Russia does not back down and formally annexes Crimea.
A senior Obama administration official said there was "concrete evidence" that some ballots in the Crimea referendum arrived in some Crimean cities pre-marked.
Russian Deputy Prime Minister Dmitry Rogozin, who was named on the White House sanctions list, suggested that the measures would not affect those without assets abroad.
Obama earlier said Russian forces must end "incursions" into its ex-Soviet neighbour, while Putin renewed his accusation that the new leadership in Kiev, brought to power by an uprising that toppled his elected Ukrainian ally last month, were failing to protect Russian-speakers from violent Ukrainian nationalists.
Moscow responded to Western pressure for an international "contact group" to mediate in the crisis by proposing a "support group" of states. This would push for recognition of the Crimean referendum and urge a new constitution for rump Ukraine that would require it to uphold political and military neutrality.
A complete preliminary count of Sunday's vote showed that 96.77 percent of voters opted to join Russia, the chairman of the regional government commission overseeing the referendum, Mikhail Malyshev, announced on television.
Officials said the turnout was 83 percent. Crimea is home to 2 million people. Members of the ethnic Ukrainian and Muslim Tatar minorities had said they would boycott the poll, held just weeks after Russian forces took control of the peninsula.
Putin's popularity at home has been boosted by his action on Crimea despite serious risks for a stagnant economy.
Russian shares and the rouble rebounded as investors calculated that Western sanctions would be largely symbolic and would avoid trade or financial measures that would inflict significant economic damage.
However, British Foreign Secretary William Hague said EU countries had begun discussing the need for Europe to reduce its reliance on Russian energy "over many years to come", much of it shipped through gas pipelines in Ukraine.
Germany, the EU's biggest economy, gets 40 percent of its gas from Moscow and could become more dependent as it switches from nuclear power.
In a sign of possible internal debates ahead, euro zone newcomer Latvia said the EU should compensate any countries hurt by sanctions against Russia. The three former Soviet Baltic states, home to Russian-speaking minorities and dependent on Russian energy supplies, could suffer in any retaliation.
Moscow defended the takeover of the majority ethnic Russian Crimea by citing a right to protect "peaceful citizens". Ukraine's interim government has mobilised troops to defend against an invasion of its eastern mainland, where pro-Russian protesters have been involved in deadly clashes in recent days.
The Ukrainian parliament on Monday endorsed a presidential decree for a partial military mobilisation to call up 40,000 reservists to counter Russia' military actions. Ukraine recalled its ambassador from Moscow for consultations.
Russia's lower house of parliament will pass legislation allowing Crimea to join Russia "in the very near future", news agency Interfax cited its deputy speaker as saying.
U.S. and European officials say military action is unlikely over Crimea, which Soviet rulers handed to Ukraine 60 years ago.
But the risk of a wider incursion, with Putin calculating the West will not respond as he tries to restore Moscow's hold over its old Soviet empire, leaves NATO wondering how to help Kiev without igniting a wider conflict.
For now, the West's main tools appear to be escalating economic sanctions and diplomatic isolation.
Highlighting the stakes, journalist Dmitry Kiselyov, who is close to the Kremlin, stood before an image of a mushroom cloud on his weekly TV show to issue a stark warning. He said: "Russia is the only country in the world that is realistically capable of turning the United States into radioactive ash."
On Lenin Square in the centre of the Crimean capital Simferopol, a band struck up even before polls closed as the crowd waved Russian flags. Regional premier Sergei Aksyonov, a businessman nicknamed "Goblin" who took power when Russian forces moved in two weeks ago, thanked Moscow for its support.
The regional parliament rubber-stamped a plan to transfer allegiance to Russia on Monday before Aksyonov travels to Moscow, although the timing of any final annexation is in doubt.
Many Tatars, who make up 12 percent of Crimea's population, boycotted the vote, fearful of a revival of the persecution they suffered for centuries under Moscow's rule.
"This is my land. This is the land of my ancestors. Who asked me if I want it or not?" said Shevkaye Assanova, a Tatar in her 40s. "I don't recognise this at all."
A pressing concern for the governments in Kiev and Moscow is the transfer of control of Ukrainian military bases. Many are surrounded by and under control of Russian forces, even though Moscow denies it has troops in the territory beyond facilities it leases for its important Black Sea Fleet.
Crimea's parliamentary speaker said on Monday Ukrainian military units in the region would be disbanded, though personnel would be allowed to remain on the Black Sea peninsula, Russian news agency Interfax reported.
Ukraine's border guard service accused Russian troops of evicting the families of their officers from their apartments in Crimea and mistreating their wives and children.