Iran has developed a missile with a range of 2,000 km (1,250 miles) and is determined to make its armed forces stronger still, a senior official was quoted as saying on Tuesday.
The announcement of a substantial increase in the range of the Islamic Republic's missiles, which could now reach south-east Europe, follows accusations by Washington and Israel that Tehran is secretly developing nuclear weapons.
Iran insists its nuclear programme is aimed only at generating electricity.
"Now we have the power to launch a missile with a 2,000 km range," the news agency IRNA quoted influential former President Akbar Hashemi Rafsanjani as saying. "Iran is determined to improve its military capabilities."
"If the Americans attack Iran, the world will change ... they will not dare to make such a mistake," Rafsanjani was quoted as saying in a speech at an exhibition on "Space and Stable National Security".
Tehran says its missiles are for defensive purposes and would be used to counter a possible Israeli or US strike against its nuclear facilities.
In recent months, Iranian officials have frequently trumpeted their ability to strike back at any aggressor, and in August they announced they had successfully tested an upgraded version of the medium-range Shahab-3 missile.
Military experts say the unmodified Shahab-3 had a range of 810 miles (1,300 km) which would allow it to strike anywhere in Israel. Shahab means meteor in Persian.
Defence Minister Ali Shamkhani said last month that a new "strategic missile" had recently been delivered to the armed forces, but did not give its range.
Israel has long accused Iran of working on a long-range missile, the Shahab-4, which would be able to reach Europe. Iran denies any plans to build a Shahab-4 missile.
Tehran recently announced plans to launch its own satellite into space next year. Military experts say a satellite launch rocket could easily be adapted for military purposes.