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Russian President Dmitry Medvedev ordered a halt to military action in Georgia, after five days of air and land attacks that took Russian forces halfway across the small Western-allied nation.
Medvedev said on national television that the military had punished Georgia enough for its attack on South Ossetia.
Georgia launched an offensive last week to regain control over the separatist Georgian province, which has close ties to Russia.
"The security of our peacekeepers and civilians has been restored," Medvedev said. "The aggressor has been punished and suffered very significant losses. Its military has been disorganised."
The Russian president, however, said he ordered the military to defend itself and quell any signs of Georgian resistance.
"If there are any emerging hotbeds of resistance or any aggressive actions, you should take steps to destroy them," he told his defence minister at a televised Kremlin meeting.
Hours before Medvedev's announcement, Russian forces bombed the town of Gori and launched an offensive in the only part of Abkhazia still under Georgian control, tightening the assault on the beleaguered nation as French President Nicolas Sarkozy arrived in Moscow carrying Western demands that Russia pull back.
President Medvedev told Mr Sarkozy that Georgia must pull its troops out of the two separatist provinces and agree not to use force again.
Russia's foreign minister, meanwhile, said that Georgia's president must leave office and Georgian troops should stay out of South Ossetia permanently.
Foreign Minister Sergey Lavrov said that Moscow will not talk to President Mikhail Saakashvili and Saakashvili "better go".