Malaysia Airlines says it lost contact with the Boeing-777 as it was due to enter Russian airspace.
It was flying at a height of around 10-thousand meters.
Images from the crash site show shattered pieces of the plane scattered in a field near the Ukranian village of Grabovo, which is said to be in rebel hands.
No one onboard is believed to have survived.
Flight MH 17 was en route from Amsterdam to Kuala Lumpur, with 15 crew members and 280 passengers from several different countries.
Malaysian Prime Minister Najib Razak says his government is dispatching a special team to Kiev.
"At this stage however, Malaysia is unable to verify the cause of this tragedy. But we must and we will find out precisely what happened to this flight. No stone will be left unturned. If it transpires that the plane was indeed shot down, we insist that the perpetrators must swiftly be brought to justice."
Several witnesses have reported hearing a large bang and shots before the plane hit the ground.
Kiev is blaming the rebels for the tragedy.
President Petro Poroshenko is calling it an act of terrorism.
"I've just finished a conversation with the Prime Minister of the Netherlands and expressed my condolences. On behalf of Ukraine, I invited professionals and experts from the Netherlands to investigate this terrorist attack transparently. I want to point your attention to the fact that we call it neither accident nor catastrophe. It's a terrorist attack."
The rebels are accusing Ukrainian government forces for downing the plane, saying they don't have the sophisticated weaponry to shoot down the jet 10-kilometers above the ground.
Russia's Interfax news agency is reporting the separatists have located the plane's black box.
US media reports are quoting officials as saying American intelligence agencies have confirmed the plane was shot down by a surface-to-air missile.
In the fallout from all this, Ukrainian authorities have closed all of Eastern Ukraine's air space.
Half of the passengers are Dutch.
Other nationalities include Australian, Malaysian, Indonesian, British, German, Belgium, the Philippines and Canada.
So far there are no reports of any Chinese nationals aboard the plane.
The disaster comes just four months after Malaysia Airlines lost contact with flight MH370, another Boeing 777 carrying more than 200 people.
The fate of that aircraft remains a mystery.
For CRI, this is Qi Zhi.
