Under the tighter restrictions exports of certain military goods such as drones, training aircraft, simulators and radio devices to Russia and Ukraine will be banned.
In addition export control authorities have been instructed to take a restrictive approach towards dual-purpose goods that may be used militarily.
The Cabinet instructed the economics ministry to draw up new tougher measures to prevent companies using Switzerland to get round European Union sanctions against Moscow.
But meeting on Wednesday it stopped short of imposing EU-style sweeping economic sanctions. These impede access to the EU financial markets for Russian banks to access and block the export of armaments and high-tech equipment to the Russian military.
Unlike the EU and the United States, Switzerland has been wary of imposing broad sanctions against Russia over Ukraine.
The government has argued that it is not just a matter of preserving the country's traditional neutrality, but also because Switzerland currently chairs the Organisation for Security and Cooperation in Europe (OSCE) and as such is trying to broker a settlement for the crisis.
Economy Minister Johann Schneider-Ammann said in an interview earlier this month that by simply falling into line with the EU Switzerland would weaken its position as mediator, the Tages-Anzeiger newspaper reported online.
Switzerland first acted against Russia after Moscow annexed the Crimean peninsula, announcing measures in April to prevent the Swiss financial sector being used to circumvent international financial sanctions.
It has also created a blacklist of Russian officials and pro-Moscow separatists considered the main movers in the Ukraine crisis.