Russian President Vladimir Putin and US President George W. Bush began talks Thursday on the sidelines of the Group of Eight summit amid a dispute over a US missile defence system.
The White House confirmed the start of the talks at a hotel in the Baltic resort of Heiligendamm which come as relations between the two countries are at a post-Cold War low.
Russia has been infuriated by the US plan for a missile defence system in Central Europe while Bush has accused Putin's government of seeking to roll back democratic reforms.
Seeking to ease tensions before the meeting, Bush said Thursday that the missile shield dispute is "not something we should hyperventilate about."
Russia believes it is the sole target of the US missile shield, which would be in Poland and the Czech Republic, and Putin has threatened to aim Russian missiles at European targets if the deployment goes ahead.
Bush said he was "looking forward" to meeting Putin despite the dispute.
"I will explain to him once again that a missile defence shield is aimed at a rogue regime that may try to hold Russia and or Europe hostage."
He added: "It is important for Russia and the Russians to understand that I believe the Cold War ended, that Russia is not an enemy of the United States, that there's a lot of areas where we can work together."
The meeting with Bush is one of several potentially prickly encounters facing Putin at the G8 summit.
On Friday, Putin will hold talks with British Prime Minister Tony Blair.
Anglo-Russian relations hit a post-Soviet low after Britain's extradition demand in May for an ex-KGB officer accused of using radioactive polonium-210 to murder a Putin critic with political asylum in Britain.
Blair, who leaves office on June 27, cautioned on the eve of the G8 that Russia risks seeing Europeans wanting "to minimize the business they do" unless it embraces "shared values."
Major oil and gas deals make Britain the largest foreign investor in the country.
Putin, attending his last G8 summit before leaving office next year, will hold his first meeting with French President Nicolas Sarkozy on Thursday.
The son of a Hungarian refugee from the Red Army, Sarkozy is believed to have a cooler attitude to Putin than his predecessor Jacques Chirac. Putin waited an eye-catching 48 hours to congratulate Sarkozy on his election win in May.
In the face of this Western pressure, Putin is pushing an increasingly assertive foreign policy backed by Russia's enormous importance as the world's top energy producer.
The Kremlin said Putin will use private meetings at the G8 to reject criticism from the United States and EU countries including Germany over his handling of democratic freedoms.
Other major points overshadowing the G8 summit include EU concerns that Moscow is using energy resources to bully neighbours, particularly pro-Western Georgia and Estonia, an EU and NATO member.
