There is "no doubt" that Russia has used cyber attacks to interfere in foreign politics, Europe Minister Sir Alan Duncan told MPs as he urged Moscow to be less suspicious of the West.
Sir Alan's comments come days after Barack Obama warned there will be "serious consequences" for Vladimir Putin if Russia does not stop its hacking activities after American spies concluded Moscow interfered in the US presidential election.
The Foreign Office minister told MPs said it was "unclear" what Russia's involvement was in the election which saw Donald Trump clinch victory but Moscow was certainly using its cyber capabilities in the "political dimension" around the world.
He suggested it was possible that Moscow's efforts were part of a systematic attempt to undermine Nato and the European Union.
Appearing before the Foreign Affairs Select Committee, Sir Alan, who is also Minister for the Americas, said: "I think there is no doubt that using modern technology they are interfering in many parts of the world. We also saw it in Montenegro, where there was a very serious interference - undeniably Russian-inspired, if I can put it that way - in the democratic process.
"Quite what the effect was, or what exactly they did in the United States is unclear. But there is no doubt, and we have to accept it as a fact, that cyber warfare is now a part of modern life and the Russians are using it as best they can in a political dimension, not just in the commercial one.
"There is political interference through cyber and that is one of the threats which we have to be aware of and be on our guard and be able to defend."
Asked by Labour MP Mike Gapes whether Moscow was engaged in "asymmetric warfare" as part of an approach to undermine Nato and the EU, Sir Alan said: "It's possible. One can only speculate if this is absolutely determined and pre-planned."
But Foreign Office political director and former ambassador to Moscow Sir Tim Barrow warned against viewing the events as a "huge policy of great complexity" directed from Moscow.
Sir Alan said Russia would benefit from being "less suspicious of us" adding: "They always seem to think that we are up to something against their interests which, if only they understood it, is not our primary intention at all."
Committee chairman Crispin Blunt said British rhetoric about Russia was worse than it had been during the Cold War.
"How have we got to a place where our relations with Russia are at such a nadir," he asked.
Sir Alan said the 25 years since the collapse of the Soviet Union had seen Russia "needing and wanting to redefine itself as a powerful nation that deserves respect" and acknowledged the UK could strike a better balance in its responses to the Kremlin.
Referring to the murder of the dissident Russian spy Alexander Litvinenko in London, Sir Alan said: "Obviously we have our Litvinenko difficulties, so in terms of our personal relationships there have been impediments and there have also been issues which we feel very strongly about such as Ukraine and subsequently Aleppo.
"We need to balance the respect they deserve with firm talk about the things of which we thoroughly disapprove.
"I hope that the balance of language and action is finding its feet perhaps a little bit more than it has done in the past and our attitude ... is one of very firm views where we think they are behaving improperly - such as challenging other countries' territorial integrity - but showing them the proper respect that a great nation is due.
"That is the balance. Perhaps we could strike it better, but that I think is the balance that we have to strike."