"China and Russia have entered into this frankly unholy alliance and President Xi has a lot of power he can exert over President Putin.
"He has chosen not to do that. The world should observe that very closely."
Dutton also denied he had been caught off guard by the speed of Russia's advancement.
"This is exactly what the military planners predicted," Dutton said.
Former foreign minister Julie Bishop agreed all eyes will now be on China's response.
"Historically, China's been very sensitive to issues of sovereignty, and it's difficult to see how it could support Russia's actions in Ukraine," she told ABC RN.
"But at the Security Council emergency meeting recently, China's representative gave a very short statement calling for disputes to be resolved by peaceful means, but there was no direct criticism of Russia."
Speaking with ABC RN, the Defence Minister said the invasion should act as wake-up call for the West and indicated a removal of the Russia ambassador from Australia was still on the cards.
"It's clear that President Putin has had this invasion in mind for some time and it should be an alarm bell. It should be a wake-up call to not only Europe but to the rest of the world," he told ABC Radio National.
Australian Prime Minister Scott Morrison on Thursday announced sanctions to an additional 25 people, including army commanders, defence ministers and Russian mercenaries along with entities involved in the sale of military technology and weapons.
The government has repeatedly indicated it will not send troops to support Ukraine on the ground.
But Ukraine's top diplomat in Australia has called on the nation's allies to do more.
"It's our country and we need to defend it ourselves. That is why the issue of sending troops was not on the agenda. But what we need is mounding pressure on the Kremlin, sanctions and financial, military and humanitarian assistance to Ukraine," charge d'affaires Volodymyr Shalkivskyi told Nine.
However, Dutton claimed Australia, the US and its allies had done all they could to deter Putin.
"What more can the world do? There can be forces sent in and then you would be saying, 'Why have we entered into a nuclear war?'" Dutton told Nine.
Greens leader Adam Bandt has called on the government to increase its humanitarian intake in the wake of the violence.
"I think Australia can and should do more, and we should be ready to take in people who are fleeing this terrible conflict," Bandt told ABC RN.
