* NATO says it's willing to discuss missiles, confidence measures
* Stoltenberg: 'Real risk for new armed conflict in Europe'
* No compromise on right of countries to determine own security (Adds Sherman quotes, U.S. sanctions bill)
By Robin Emmott and Sabine Siebold
BRUSSELS, Jan 12 (Reuters) - NATO said on Wednesday it was willing to talk to Russia about arms control and missile deployments but would not allow Moscow to veto Ukraine's ambition to join the alliance, warning of a real risk of a new war in Europe.
The offer by NATO Secretary General Jens Stoltenberg addressed only a fraction of the sweeping demands presented by Russia, which has forced the West to the negotiating table by massing some 100,000 troops near the border with Ukraine. It was not immediately clear how Moscow would respond.
Stoltenberg said after four hours of talks between alliance ambassadors and a Russian delegation in Brussels that NATO would not let Moscow dictate security arrangements to other countries and create dangerous spheres of influence.
"There is a real risk for new armed conflict in Europe," Stoltenberg told a news conference.
"There are significant differences between NATO allies and Russia," he said. "Our differences will not be easy to bridge, but it is a positive sign that all NATO allies and Russia sat down around the same table and engaged on substantive topics."
Russia denies planning to invade Ukraine but says it needs a series of guarantees for its own security, including a halt to any further NATO expansion and a withdrawal of alliance forces from central and eastern European nations that joined it after the Cold War.
U.S. Deputy Secretary of State Wendy Sherman, who led the U.S. delegation in talks with Russia in Geneva on Monday, said she had not heard anything new from the Russian side in Brussels.
She told reporters it was hard to understand why a nuclear-armed Russia felt threatened by its much smaller neighbour and was conducting live-fire exercises near its border.
"What is this about? Is this about invasion? Is this about intimidation? Is this about trying to be subversive? I don't know, but it is not conducive to getting to diplomatic solutions," she said.
Russia had not given any commitment to de-escalate, she said, but nor had it said it would not do so.
HIGH PRICE
Stoltenberg said any use of Russian force against Ukraine would be a serious political mistake for which Russia would pay a high price.
U.S. Senate Democrats on Wednesday unveiled a bill to impose sweeping sanctions on top Russian officials, including President Vladimir Putin, and key banking institutions if Moscow engages in hostilities against Ukraine.
Stoltenberg reiterated NATO's position that only Ukraine and NATO can decide whether Ukraine becomes a member - a prospect NATO promised it, in principle, as far back as 2008.
However, he said NATO was ready for further talks with Moscow on issues including arms control, missile deployments and confidence-building measures. Russia had asked for time to come back with an answer on this, he added.
Sherman said it was important that Russia had not rejected the idea of more discussions.
Russian Deputy Foreign Minister Alexander Grushko, who headed Moscow's delegation, was due to brief reporters later.
Russia has accused the West of failing to appreciate the urgency of its demands, and said it is not prepared to allow negotiations to drag on indefinitely.
It says NATO's expansion from 16 members at the end of the Cold War to 30 now - including a large group of ex-communist states in central and eastern Europe - poses a threat to its security and it needs to draw "red lines" now to protect itself.
(Additional reporting by Francois Murphy in Vienna and Dmitry Antonov in Moscow; writing by Mark Trevelyan; editing by Gareth Jones and Philippa Fletcher)
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