Siversk's defeat brought Russian forces closer to the center of Sloviansk, about 30km west of Siversk.
Sloviansk is the northern anchor of the "fortress belt" that includes cities in Ukraine's Donbass region.
According to information from the General Staff of Ukraine, Russia advanced in Siversk thanks to significant advantage in numbers and continuous pressure from small attack groups in harsh weather conditions.
Kiev said the withdrawal of troops from Siversk was to preserve life and resources. Ukraine also affirmed that it had caused heavy losses to Russia.
Along with the announcement of its withdrawal from Siversk, Ukraine said that Ukrainian forces are continuing to put pressure in Siversk and will continue to make efforts to cut off the supply route for the Russian army inside the town.
In early December, Russia announced the capture of Siversk, a city with a population of about 10,000 people before the conflict. However, Kiev had denied the claim at the time.
Data from Ukraine's open-source group Deep State shows that Russia has made gradual progress around Siversk in December.
Fighting is still fierce around Pokrovsk, the former eastern logistics hub, where Ukrainian forces repelled an unusually large-scale Mechanical attack by Russia this month.