French President Francois Hollande and German Chancellor Angela Merkel brought together Russia's Vladimir Putin and Ukrainian president-elect Petro Poroshenko for a 15-minute meeting before they joined other dignitaries for lunch.
French officials have been plotting for weeks to use the 70th anniversary of the D-Day landings - a key event helping to end World War Two - to try to break the ice in the most serious European security crisis since the end of the Cold War.
Hollande's office said Putin and Poroshenko shook hands and agreed that detailed talks on a ceasefire between Kiev government forces and pro-Russian separatists in easternUkraine would begin within a few days.
Poroshenko, brought to power by pro-Western protests which Putin has termed a coup, was photographed looking unsmiling and earnest as he stood with the Russian leader and Merkel.
"It was a normal, serious exchange between two leaders," an official in Hollande's office said.
"This marks tentative progress which he (Hollande) welcomes, particularly given this occasion so symbolic for peace," the official said, adding they also discussed steps such as Russian recognition of Poroshenko's election and economic relations.
Putin told traveling reporters he welcomed proposals set out by Poroshenko for ending the conflict. However he declined to say what they were and said Ukraine must halt what he called "punitive" military operations against pro-Russian separatists.
But he added: "I felt the attitude was right as a whole ... If this (plan) happens, then it creates conditions for the development of relations in other areas, including the economy."
Interfax in Ukraine cited Poroshenko as saying he expected a Russian representative" to come to Ukraine to discuss his ideas for a settlement plan. He added that he saw "good chances" of it being implemented.
Hollande had invited Poroshenko to Normandy as his personal guest at the last minute in an effort to break the ice between Moscow and Kiev even as fighting continued in eastern Ukraine between government forces and pro-Russian separatists.
The rebels shot down a Ukrainian army plane on Friday and killed a member of the interior ministry's special forces in the separatist stronghold of Slaviansk, where residents said shelling continued all day.
A White House official said Putin and Obama, who had avoided contact with the Russian leader while the two were in Paris on Thursday - also spoke to each other before the lunch.
"President Obama made clear that de-escalation depends upon Russia recognizing President-elect Poroshenko as the legitimate leader of Ukraine, ceasing support for separatists in eastern Ukraine, and stopping the provision of arms and material across the border," deputy national security adviser Ben Rhodes said.
"If Russia does take this opportunity to recognize and work with the new government in Kiev, President Obama indicated that there could be openings to reduce tensions," he added.
World leaders and veterans paid tribute to soldiers who fell in the liberation of Europe from Nazi German rule, at a series of ceremonies around the Normandy beaches where allied forces landed 70 years ago on June 6, 1944.
Wreaths, parades and parachute-drops honored history's largest amphibious assault, in which 160,000 U.S., British and Canadian troops waded ashore to confront German forces, hastening its defeat and the advent of peace in Europe.
Flanked by stooped war veterans, some in wheelchairs, Obama earlier joined Hollande to commemorate victory and reaffirm U.S-French solidarity before the 9,387 white marble headstones of fallen U.S. soldiers at the Normandy American Cemetery.
It will be the last major commemoration for most of the veterans, most of whom are in their late 80s and 90s.
Obama said the 50-mile (80 km) stretch of Normandy coastline - where allied soldiers landed under fire on beaches codenamed Omaha, Utah, Gold, Sword and Juno - was a "tiny sliver of sand upon which hung more than the fate of a war, but rather the course of human history."
"Omaha - Normandy - this was democracy's beachhead," said Obama. "And our victory in that war decided not just a century, but shaped the security and well-being of all posterity."
The president sought to link the sacrifices of World War Two to U.S. servicemen killed in combat since the Sept. 11, 2001 attacks on the United States by al Qaeda Islamist militants.
The "9/11 generation of service members" understood that "people cannot live in freedom unless free people are prepared to die for it", he said.
Hollande declared that France "would never forget the solidarity between our two nations, solidarity based on a shared ideal, an aspiration, a passion for freedom".
Twenty-one foreign leaders attended the commemorations, including Britain's Queen Elizabeth and Prime Minister David Cameron, Canada's Stephen Harper as well as Merkel and Putin, whose country suffered the heaviest casualties and struck decisive blows on the eastern front to defeat the Nazis
BY JOHN IRISH, JEFF MASON AND ALEXEI ANISHCHUK