The Iranian navy fired four missiles into the Persian Gulf, sinking a target the size of a warship, the country's military said, according to state-run Press TV.
The missile drill comes as the United States and other military conduct massive minesweeping exercises in the Arabian Gulf.
The U.S. military says these exercises are strictly "defensive," but the show of force in light of Iran's threats to mine the Strait of Hormuz is hard to ignore.
The Islamic Revolution Guard Corps fired the missile simultaneously at the large target, which sank in 50 seconds, Navy Cmdr. Rear Adm. Ali Fadavi said, according to Press TV.
Fadavi pointed out that Iran's missile systems can reach the entire Persian Gulf, including past where U.S. bases are located, Press TV reported.
In reference to the minesweeping drill, Fadavi said Iran is keeping a "moment-by-moment watch on every move of the Americans."
"Over the past years, we have not neglected to enhance our naval capabilities, particularly in the field of mines, and these capabilities are unimaginable to the Americans," Fadavi said, according to Press TV.
The Pentagon did not immediately confirm if such a missile test was carried out.