Iran has tested a Shahab-3 missile with a range of 2,000 km (1.240 miles), the Alalam satellite TV channel reported on Wednesday.
The missile is capable of hitting Israel and U.S. military bases in the Persian Gulf.
The launch took place at an undisclosed desert location as part of the Great Prophet III war games.
Iranian state-run TV reported that Islamic Revolutionary Guard Corps naval and air units had fired nine long- and medium-range missiles in order to "improve combat capability."
"We have launched the missiles in honor of Iran , to demonstrate just a small part of our military capability," said Revolutionary Guards air force commander Hossein Salami.
The test of the Shahab-3 missile comes after the Israeli Air Force conducted military exercises involving over 100 Israeli fighters in early June. The exercises were widely seen as a ''dress rehearsal'' for an attack on Iranian nuclear facilities.
Iran has reacted to rumors of an imminent attack by promising to deliver a "powerful blow" to any aggressor and vowing to block the Persian Gulf and the Strait of Hormuz, cutting off the world''s largest oil-exporting region.
The tests occurred as vessels from the U.S, the U.K, and Bahrain held joint exercises in the Persian Gulf.
The U.S. Navy said in a statement on Monday it was holding exercises in the Gulf to "practice the tactics and procedures of protecting maritime infrastructure such as gas and oil installations."
Iran is currently under three sets of relatively mild UN Security Council sanctions for defying demands to halt uranium enrichment, which it says it needs purely for electricity generation. The U.S. and other Western states have claimed that the program is geared toward the creation of nuclear weapons.
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