"Russia's invasion of Ukraine is a clear violation of international law," Harper said in a statement.
"Canada will contribute observers to an important military observer mission in a co-ordinated effort to better monitor the Russian military intervention in Crimea."
The two observers will deploy immediately under the auspices of the Organization for Security and Co-operation in Europe, he said.
A spokeswoman for Defence Minister Rob Nicholson later said the two Canadian Forces members have arrived in Odessa, Ukraine, and are presently co-ordinating with Ukrainian and other observers.
The Ukrainian ambassador to Canada, Vadym Prystaiko, told The Canadian Press earlier this week that many governments are looking for a first-hand look at the situation in Crimea.
He said the Ukrainian government wants to disprove the Russian claim that their invasion is in support of civilians in the Crimean peninsula.
Foreign Affairs Minister John Baird also affirmed that Canada would once again contribute a large contingent of election observers for Ukraine's next scheduled election in May.
Baird told the Commons that on his recent trip to Kyiv he offered Ukraine's new prime minister and president "our full support in the conduct of the presidential election on May 25."
"We have provided substantial assistance in the past, and we will obviously provide long-term and short-term election observers to ensure that the will and courage of the Ukrainian people be fully respected by the international community."
Canada last sent a large observer force of hundreds to Ukraine in 2012 to monitor parliamentary elections, a regular occurrence that started in 2004 when former Liberal prime minister John Turner led a large team of international election monitors.
Harper also announced additional economic sanctions Wednesday against members of the Yanukovych regime, which he said came "at the request of the prosecutor general of Ukraine."
Canada is also prepared to offer financial assistance and co-operation with its allies, including collaboration with the International Monetary Fund. Harper said it is critical that Ukraine receive financial assistance.
The prime minister said Canada is also suspending its participation in a joint commercial venture with Russia. The Canada-Russia Intergovernmental Economic Commission had been established to promote bilateral trade.
"Our actions with respect to the IEC, the freezing of assets of corrupt Ukrainian officials held in Canada and our involvement in the OSCE mission are further examples of our support for Ukraine and our goal of stabilizing the tense situation in Crimea," his statement said.
"President (Vladimir) Putin must now immediately withdraw his forces to their bases and refrain from further provocative and dangerous actions."
Harper earlier discussed the Ukraine crisis with Poland's Prime Minister Donald Tusk.
"The two leaders discussed developments in Crimea," Harper's office said. "They condemned in the strongest terms President Putin's military intervention in Ukraine, noting that a de-escalation of the situation is in the best interest of the entire international community."
The United States also announced support for its allies in Europe, including joint training with the Polish air force.
The Pentagon is increasing U.S. participation in NATO air missions in support of Baltic countries.
NATO said that it is suspending most of its meetings and reviewing all of its co-operation with Russia.
Anders Fogh Rasmussen, the alliance's secretary general, said its 28 members also decided "to intensify our partnership with Ukraine."
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