Ex-lawyer Alexei Navalny was ruled ineligible to run for president by Russia‘s Central Election Commission (CEC) earlier this week.
The 41-year-old responded by calling for a boycott of the vote, to be held in March, and threatening mass protests across the country.
Mr Navalny told his supporters the rallies would take place on January 28, raising the prospect of violent clashes with police.
But in a threat to Mr Navalny, a Kremlin spokesman insisted the upcoming vote would be legitimate and warned a boycott could be illegal.
He said: “Appeals for a boycott are subject to very scrupulous examination of whether they comply with or contradict the law.”
The warning has sparked fears of a wider crackdown against those seeking to stand against Vladimir Putin.
The president, who has been in power for almost 18 years in various roles, is widely expected to be re-elected with a thumping majority.
His approval ratings remain above 80 per cent, according to pollsters at the independent Levada Centre.
Mr Navalny has been campaigning all year to build support for an election run, amassing a grassroots network of volunteers.
But CEC officials voted to block him from challenging Mr Putin on Monday, citing a past criminal conviction for corruption.
The anti-Kremlin activist has always maintained his conviction, handed down in 2014, was “politically motivated”.
Mr Navalny previously stood in the 2013 race to become Moscow’s mayor, receiving nearly 30 per cent of the vote.
In a video message released moments after the CEC ruling, Mr Navalny said the upcoming poll was “not a real election”.
He said: “It will feature only Putin and the candidates whom he personally selected. Going to the polls right now is to vote for lies and corruption.”
And on Twitter, he wrote: “People are asking about street protests against the CEC decision. Yes, of course we will organise a country-wide protest.
“And we will prepare it well. It has to be really Russia-wide.”
It comes as Mr Putin formally registered his re-election bid today, submitting the necessary documents to Russia’s CEC in person.
He is running as an independent, a move seen as a way of strengthening his image as a “father of the nation” rather than as a party political figure.
The ruling United Russia party and the Just Russia party have both said they will support the former KGB officer.
Allies laud Mr Putin for restoring national pride and expanding Moscow’s global clout with interventions in Syria and Ukraine.
But Mr Navalny says he has been in power too long, with his support artificially maintained by a biased state media and an unfair political system.