Iran's state TV is reporting that the country's President Hassan Rohani has unveiled the first Iranian made semi-heavy submarine.
The Sunday report said the Fateh, "Conqueror" in Persian, is capable of being fitted with cruise missiles.
Since 1992, Iran has developed a homegrown defense industry that produces light and heavy weapons ranging from mortars and torpedoes to tanks and submarines.
The Fateh has subsurface-to-surface missiles with a range of about 2,000 kilometers (1,250 miles), capable of reaching Israel and U.S. military bases in the region.
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On Sunday, Iran's foreign minister accused Israel of looking for war and warned that its behavior and that of the United States was increasing the chances of a clash in the region.
"Certainly, some people are looking for war ... Israel," Mohammad Javad Zarif said at the Munich Security Conference.
Iranian President said earlier Sunday that Tehran wanted to establish close ties with all countries in the Middle East, where Iran has been involved in proxy wars with Saudi Arabia for decades.
"Iran is ready to work with regional states to preserve security in the Middle East ... Our enemies, America and Israel, want to create division among Iranians ... We will not succumb to pressure from America and Israel," Rohani said in a public speech in southern Iran, broadcast live on state TV.