The US and Israel have condemned Iran after it test-fired a long range missile capable of reaching Tel Aviv.
Iran state media said nine missiles had been fired in total, including a new Shahab-3, with a range of 2,000km (1,240 miles).
Tehran has tested the missile before, but the latest launch comes amid rising tensions with the US and Israel over the country's nuclear programme.
A senior US state department official said the launch was "provocative".
Wednesday's early morning test at a remote desert site sent oil prices climbing.
"Israel should prepare itself to do what is needed to do"
Brig Gen Hoseyn Salami, commander of Iran's Revolutionary Guards' air force, said: "Our missiles are ready for shooting at any place and any time, quickly and with accuracy."
Western leaders have been attempting to convince Tehran to stop enriching uranium, which it has continued doing despite sanctions from the UN and the European Union, insisting its nuclear programme is purely for civilian energy.
US Under-secretary of State William Burns said that thanks to UN sanctions, Iran's real progress on its nuclear programme had been "modest", despite its sabre-rattling.
"We view force as an option that is on the table but a last resort," he told a Congressional hearing on Wednesday.
The launches were intended to deter any Israeli or US strike against Tehran's nuclear installations, says BBC diplomatic correspondent Jonathan Marcus.
Our correspondent - who is in Israel - says the country has a fully operational anti-ballistic missile system, which Israeli military experts believe can counter any Iranian threat.
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In the Israeli parliament, Housing Minister Ze'ev Boim said: "I suggest Israel will not talk, and Israel should prepare itself to do what is needed to do."
The White House and both American presidential candidates also condemned the Iranian test.
Describing Iran as a "great threat", the Democratic challenger, Barack Obama, called for tougher sanctions while his Republican rival, John McCain, said the test demonstrated the need for effective missile defence.
The French, German and Italian governments expressed concern at the missile tests.
On Monday, an adviser to Iran's supreme leader said it would retaliate against any military attack by hitting the Israeli city of Tel Aviv.
Other commanders have threatened to close the Strait of Hormuz, through which a large part of the world's oil flows, and to target the US and its allies around the world if Iran comes under attack.
Iranian President Mahmoud Ahmadinejad has insisted his country had no intention of attacking Israel.
Speaking on a visit to Malaysia on Tuesday, Mr Ahmadinejad dismissed the possibility of an attack by the US or Israel as a "joke".
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