PRISTINA, Yugoslavia (CNN) -- Even though Richard Holbrooke, senior U.S. envoy for the Balkans, on Tuesday kept up his shuttle diplomacy by talking to ethnic Albanian leaders in Kosovo, NATO strikes seemed one step closer as Yugoslav President Slobodan Milosevic remained defiant over his crackdown against separatist rebels in the Serbian province.

Holbrooke traveled to Kosovo's capital Pristina on Tuesday for talks with Kosovo Albanian leader Ibrahim Rugova, following a briefing by the Kosovo Diplomatic Observer Mission, which has been monitoring the conflict between Serbian security forces and the ethnic Albanian Kosovo Liberation Army.

Hundreds of people have been killed and hundreds of thousands of others -- mostly ethnic Albanians -- have been displaced by the Serbian crackdown, which began in February.

"It was a grim briefing," Holbrooke told reporters after the briefing. "U.S. diplomatic observers are doing a terrific job bringing us information, and the information is not good."

Despite Holbrooke's shuttle talks, the likelihood of Milosevic concessions or a diplomatic agreement that would satisfy Western leaders set on military intervention appeared limited.

Milosevic told Holbrooke late Monday that his government is willing to seek a "political solution" to the seven-month crisis in Kosovo, where ethnic Albanian rebels are battling for independence. Ethnic Albanians form 90 percent of the 2 million-strong Kosovo population, and most favor self-rule.

But Milosevic called the threats of NATO strikes against Yugoslavia "a criminal act" that provide "support for the Albanian villains, not the Albanian people," according to a statement issued through state media.

His defiant comments came after a meeting that lasted several hours in which Holbrooke told the Yugoslav president of the "the grave situation we are facing."

Holbrooke was expected to hold a second round of talks with Milosevic later in the day.

The United States and its allies have threatened to unleash NATO attacks unless Milosevic meets U.N. demands to withdraw his military and negotiate an autonomy deal for Kosovo with Rugova.

Ethnic Albanian leaders have proved as difficult to persuade to start talks as Milosevic, insisting that autonomy is no longer an option and demanding full independence, which the West has ruled out.

There was also no sign on Tuesday of the international diplomatic deadlock ending.

Russia on Tuesday maintained its diplomatic campaign to prevent the NATO action and was joined by China in a demand for a political solution rather than military intervention.

Russia's Interfax news agency said the Moscow government would use its veto in the U.N. Security Council to stop air strikes.

Moscow believes NATO needs a U.N. further resolution to provide a legal basis for any military action.

President Bill Clinton told Russian President Boris Yeltsin in a telephone conversation he feared Milosevic, who enjoys Russian protection, was "playing the classic game of making false promises designed to remove international pressure."

Correspondent Brent Sadler, The Associated Press and Reuters contributed to this report.

"Kosovo: A Short History" by Noel Malcolm "Between Serb and Albanian: A History of Kosovo" by Miranda Vickers "Hearts Grown Brutal: Sagas of Sarajevo" by Roger Cohen "A Short History of the Yugoslav Peoples" by Frederick Bernard Singleton "Unwinnable Wars: American Power and Ethnic Conflict" by David Callahan Click here for additional reading on Yugoslavia