The Foreign Secretary said Moscow had engaged in "19th century forms of diplomacy" during the five-day war over South Ossetia and its leaders must understand that "the Soviet Union does not exist any more."
His comments come amid reports that 50 Russian tanks remained in the battered Georgian town of Gori, despite Russian claims that its army had withdrawn.
Mr Miliband said the sight of Russian forces advancing into its neighbouring state had “brought a chill down the spine”.
Speaking ahead of an emergency meeting of EU foreign ministers convened to discuss the crisis, he said Russia risked being frozen out of the international community unless it urgently changed course.
“There is a new map in Eastern Europe, and that new map needs to defended. It’s not in Russia’s interest to hanker for a Soviet past. It’s gone, and it’s good that it’s gone,” he said.
“The Russians want to assert themselves in ‘ex-Soviet space’ – that’s not acceptable. These are individual, sovereign countries, with territorial integrity of their own.”
Mr Miliband told BBC Radio 4 that Russia’s actions amounted to “a reversion not just to Cold War politics, but to 19th Century politics”, and said Dimitry Medvedev, the Russian President, must understand there would be serious political consequences to his response to Georgia’s attempt to reclaim South Ossetia, a separatist province on the Russian border.
“The G7 has shown its willingness to work without Russia,” he said. “That’s quite unprecedented since the start of the G8. I think that makes very clear to Russia the political consequences of their actions.”
“Russia do have rights, but they must be combined with responsibilities. There will be political consequences if they do not uphold them,” Mr Miliband said.
Mr Miliband’s comments came as Alexander Lomaia, the secretary of Georgia’s security council, told reporters that “fifty Russian tanks and APCs (armoured personnel carriers) are in Gori. They are not entering buildings.”
The report was denied by the Kremlin. “Neither Russian peacekeepers nor any units subordinate to them are present in Gori,” a Russian military spokesman said.
Mr Miliband said: “The sight of Russian tanks rolling into parts of a sovereign country on its neighbouring borders will have brought a chill down the spine of many people, rightly.”
Hours earlier the Georgian President, Mikheil Saakashvili, agreed in principle to an outline peace plan presented to Moscow and Tbilisi by the French President, Nicolas Sarkozy, in his capacity as current EU President.
Mr Miliband said that he supported the central tenet of the EU-proposed peace plan, which demands a return of all troops to the “status quo ante” of before August 7. However he implied criticism of the Russian interpretation of the plan, which amounts to additional measures to secure South Ossetia and Abkhazia, another rebel Georgian province, for itself.
“The territorial integrity of Georgia is an absolutely key issue,” he said. “Countries need to know that their territorial integrity is absolutely secure,” he said.
Admitting that political relations between Britain and Russia are “not good”, Mr Miliband said that he had been warning publicly and for some time that the way in which Russia was conducting foreign affairs was unacceptable. He said: “It’s simply not the way that international relations can be run in the 21st century”.