Washington's approval for Ukraine to use American missiles against military targets inside Russia is a "big mistake" which could drag the world to the brink of a "major war", Turkey's Recep Tayyip Erdogan said in remarks published on Wednesday.

The move to let Kyiv use powerful long-range ATACMS missiles represents a major US policy shift, sparking a furious response from Moscow, which on Tuesday broadened the scope of when it can use nuclear weapons in a clear warning to Ukraine and the West.

"This step by (US President Joe) Biden will not only escalate the conflict, but will lead to a greater reaction from Russia ... (and) may bring the region and the world to the brink of a major new war," the Turkish president told journalists on the flight back from the G20 summit in Rio.

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The US decision "could be interpreted as a move to fuel the war, to ensure it never ends and even spreads," he said, pointing out that Tuesday's decree signed by Russia's President Vladimir Putin allows Moscow to unleash a nuclear response in the event of a massive air attack, even if only with conventional weapons.

"The slightest mistake made on the basis of this big mistake ... will be like throwing the powder keg into the fire, so I advise everyone to be careful," he said.

Turkey, which enjoys friendly ties with its two Black Sea neighbours, has supplied Ukraine with drones but shied away from Western sanctions on Moscow.

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Putin's revision of Russian nuclear policy was swiftly condemned by Washington, Brussels and London as "irresponsible" and Erdogan said the measure should be examined by NATO.

"The step taken by Russia should be considered by the NATO authorities and should also be reviewed," he told a press conference in Rio on Tuesday.

"Russia has the strength and measures to protect itself, in a similar way, as NATO countries, we also have to take steps to protect ourselves," he said.

The Russian president has used nuclear rhetoric throughout the conflict but has grown increasingly belligerent since last year, pulling out of a nuclear test ban treaty and a key arms reduction agreement with the US.

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