Israel said on Thursday it is developing a new ballistic missile shield, the Arrow-4, with the United States, another layer in a defensive system built with an eye towards Iran.
Israel's Arrow-2 and Arrow-3 interceptors are already operational as part of a multi-layered system to destroy incoming missiles in the atmosphere and in space.
"The development of Arrow-4 together with our American partners will result in a technological and operational leap forward, preparing us for the future battlefield and evolving threats in the Middle East and beyond," Defence Minister Benny Gantz said in a statement.
Israeli leaders have described Iran's ballistic missile programme as a threat to Israel and the world. Iran says its missile development is defensive and aimed at deterring attack.
The Defence Ministry said Israel Aerospace Industries would serve as the prime contractor for the Arrow-4. Boeing and Israel's Elbit Systems are also part of the Arrow defence project.