Officials say the Shahab-3 missile has a range of 2,000 kilometres and is armed with a 1-ton conventional warhead. (Iranian TV via APTN/Associated Press)

Iran test-fired nine long- and medium-range missiles Wednesday during war games that officials said are in response to U.S. and Israeli threats, state television reported.

Gen. Hossein Salami, the navy commander of Iran's elite Revolutionary Guards, was quoted as saying the exercise would "demonstrate our resolve and might against enemies who in recent weeks have threatened Iran with a harsh language."

The war games were being conducted at the mouth of the Strait of Hormuz, a strategic waterway through which 40 per cent of the world's oil passes.

The report didn't provide details, but said the missiles fired included a new version of the Shahab-3, which officials have said has a range of 2,000 kilometres and is armed with a one-ton conventional warhead.

U.S. Defence Secretary Robert Gates said the Iranian missile tests illustrate the threat that the Islamic country poses to the region.

"We've been saying, as we've talked about missile defence in Europe, that there is a real threat, and it seems to me the tests this morning underscore that," Gates said.

But asked whether the U.S. and Iran are any closer to a military confrontation, he sounded a cautious note.

"No, I don't think so," Gates said.

The tests came less than a day after Iranian President Mahmoud Ahmadinejad dismissed fears that Israel and the United States could be preparing to attack his country, calling the possibility a "funny joke.

"I assure you that there won't be any war in the future," Ahmadinejad told a news conference Tuesday during a visit to Malaysia for a summit of developing Muslim nations.

Iranian officials have been issuing a mix of conciliatory and bellicose statements in recent weeks about the possibility of a clash with the U.S. and Israel.

Israeli military exercise a possible rehearsal: U.S.

Israel's military sent warplanes over the eastern Mediterranean for a large exercise in June that U.S. officials described as a possible rehearsal for a strike on Iran's nuclear facilities, which the West fears are aimed at producing atomic weapons.

Iran says its nuclear program is geared only toward generating electricity, not weapons.

For months, Ahmadinejad and other Iranian officials have said they don't believe the U.S. will attack because of its difficulties in Iraq, domestic worries and concerns over the fallout in the region.

At the same time, Tehran has stepped up its warnings of retaliation if the Americans — or Israelis — do attack it, including threats to hit Israel and U.S. Gulf bases with missiles, and stop oil traffic through the vital Gulf region.

In late June, Vice Adm. Kevin Cosgriff, then the commander of the U.S. navy's 5th Fleet, said any attempt by Iran to seal off the Strait of Hormuz would be viewed as an act of war. The 5th Fleet is based in Bahrain, across the Gulf from Iran.

The Israeli exercise was widely interpreted as a show of force as well as a practice on skills needed to execute a long-range strike mission.

Shaul Mofaz, an Israeli cabinet minister, set off an international uproar last month by saying in a published interview that Israel would have "no choice" but to attack Iran if it doesn't halt its nuclear program.

Mofaz is a former military chief and defence minister, and has been Israel's representative in a strategic dialogue on Iran with U.S. officials.

The Revolutionary Guards and Iran's regular army routinely hold exercises two or three times a year.