Thousands of people celebrated in the Crimean capital of Simferopol after the region broke away from Ukraine and was formally accepted into the Russian Federation.

Celebrations continued into early Saturday, hours after President Vladimir Putin signed a treaty making Crimea part of Russia. Fireworks burst in the sky in Simferopol as the Crimean prime minister, Sergei Aksyonov, addressed the crowds.

"I am sure that we all together will live in a new Crimea happily, we will live the way our fathers and grandfathers wanted us to live as we dreamed. This is fair and we deserved it. Happy holiday, dear friends," he said.

I am sure that we all together will live in a new Crimea happily. Sergei Aksyonov, Crimean Prime Minister

The celebrations were timed to coincide with a similar event taking place in Moscow, where fireworks also lit up the skies.

During his visit to Ukraine on Saturday, Germany's foreign minister Frank-Walter Steinmeier denounced Russia's "attempt to splinter Europe" for its action in Crimea.

"The referendum in Crimea... is a violation of international law and an attempt to splinter Europe," Steinmeier said after meeting Ukraine's acting president Oleksandr Turchynov.

As this developed, an international team of monitors is being sent in to Ukraine's eastern region, where tensions continue to brew between supporters and opponents of Russia.

The team from the Organization for Security and Co-operation in Europe [OSCE] will begin its work after Russia dropped its objections. But there is disagreement on whether they will be allowed in to Crimea itself.

A military transition is also underway as Russia takes over bases across the Black Sea Peninsula, raising its national flag as Ukrainian soldiers departed on their trucks.

On Friday, all 155 senators present in Moscow's upper house of parliament voted in favour of the treaty of accession.

In Brussels, the acting prime minister of Ukraine, Arseniy Yatsenyuk, signed an association agreement with the European Union.

"This is a historic day for my country, and we believe this is a historic day for the entire Europe," Yatsenyuk declared after signing the agreement. "We want to be a part of a big European family."

Appeal for diplomacy