US senators from President Joe Biden's Democratic Party on Wednesday threatened major consequences if Russia invades Ukraine, including sanctions on President Vladimir Putin, Russian banks, and $500 million in fresh security aid to Kyiv.

The introduction of legislation comes as the United States and its NATO allies hold talks with Russia and warn of high costs if the tens of thousands of troops on Ukraine's border advance.

"We are coming together to send a clear message -- Putin need not collapse his entire economy nor does he need to sacrifice the lives of his own people in a futile attempt to rewrite the map of Europe," said Senator Bob Menendez, the chairman of the Senate Foreign Relations Committee.

Senate Majority Leader Chuck Schumer said the legislation "serves as a powerful deterrent by immediately and forcefully imposing crippling sanctions" if Russia invades.

The so-called Defending Ukraine Sovereignty Act would mandate US sanctions on Putin and an array of top Russian officials as well as on at least three major financial institutions.

It would also penalize services such as the SWIFT international banking network if they deal with sanctioned Russians.

The act would provide $500 million in additional military aid to Ukraine to face off a Russian invasion, more than doubling what the Biden administration has provided in the past year.

US lawmakers across party lines take a hard line against Putin, who has denied plans to invade Ukraine but made security demands including guarantees that NATO will not expand into its neighbor, where a pro-Moscow insurgency has raged since 2014.

But the Democratic-led legislation comes amid a feud in Congress as Republicans led by Senator Ted Cruz call a vote on a bill that would slap sanctions on businesses involved in Nord Stream 2, a gas pipeline built from Russia to Germany that has long been opposed by Ukraine which fears losing leverage.

Democrats agreed to the vote in a deal in which Cruz lifted a months-long holdup of Biden's ambassadorial nominees, but the Biden administration has been pressing hard against his bill, saying it would put at risk an understanding with Germany to stop the pipeline if Russia invades Ukraine.

Cruz's bill "will undermine our efforts to deter Russia and remove leverage the United States and our allies and partners possess in this moment all to score political points at home," National Security Council spokeswoman Emily Horne said.

She said the administration backed Menendez's bill as it would "trigger severe costs to Russia’s economy," she said.