European leaders and Russia signaled cautious optimism over a peace deal for Ukraine after a high-level meeting in Milan on Friday, but emphasized details still need to be worked out.

European leaders are pressing Russian leader Vladimir Putin to fully respect a cease-fire deal signed last month in Belarus, which has reduced by not completely ended hostilities in eastern Ukraine.

European Commission President Jose Manuel Barroso said the leaders agreed the need to verify the cease-fire, to hold local elections in eastern Ukraine in compliance with Ukrainian law and to control the border areas.

He said further meetings would discuss how to implement the broad agreements.

One proposal being discussed on the sidelines by the Russian, Ukrainian and Italian foreign ministers is using drones to control the border areas, an Italian foreign ministry official said.

Italian Premier Matteo Renzi said he was "positive" following the nearly two-hour meeting bringing together Putin and Ukrainian President Petro Poroshenko with the leaders of Germany, France, Britain and Italy.

"We cannot accept an unstable Ukraine and so we will do all in our power to give back hope to Ukraine," Renzi told reporters.

Putin's spokesman Dmitry Peskov told reporters that the talks were difficult but constructive, adding that leaders of Russia, France, Germany and Ukraine will hold a separate meeting later Friday to continue the discussion.

Peskov said that Putin may also meet one-on-one with Poroshenko later in the day.

"It was a good meeting," Putin said on arrival at the wider ASEM summit of more than 50 European and Asian leaders in Milan.

British Prime Minister David Cameron also indicated progress but said Russia needs to get its troops and heavy weapons out of Ukraine.

"Vladimir Putin said very clearly that he doesn't want a frozen conflict, he doesn't want a divided Ukraine," Cameron said. "If that is the case, Russia has to take actions to put in place all that has been agreed."

Putin met separately overnight with German Chancellor Angela Merkel. The Kremlin, in a readout on the nearly 2½-hour meeting, said the leaders emphasized the need to separate the warring sides in eastern Ukraine and talked about monitoring the cease-fire. They continued to disagree on the roots of the conflict.