MOSCOW—Russian-backed separatists declared a new state in Ukraine on Tuesday, ratcheting up a confrontation with the Kiev government, though Moscow distanced itself from the move as the Trump administration steps up efforts to resolve the three-year-old crisis.

A statement released by the separatist Donetsk News Agency declared the formation of a new state called Malorossiya, or Little Russia—a name once used to refer to Ukrainian lands within the czarist empire. The new state, the declaration said, would include all the regions...