Any attack by Israel on Iran will blow back on the Jewish state "like thunder," Iran's supreme leader, Ayatollah Ali Khamenei, said on Sunday.
Khamenei also said that the international community's suspicion that Iran was seeking nuclear weapons is based on a "lie" and he insisted that sanctions imposed on his country were ineffective and only strengthened its resolve.
His speech, broadcast on state television to mark the 1989 death of his predecessor and founder of the Islamic republic, Ayatollah Ruhollah Khomeini, contained no sign Iran was prepared to make any concessions on its disputed nuclear programme.
Instead, it was infused with defiance and Khamenei's customary contempt for Iran's arch-foes Israel and the United States.
If the Israelis "make any misstep or wrong action, it will fall on their heads like thunder," Khamenei said.
The Jewish state, he added, was feeling "vulnerable" and "terrified" after losing deposed Egyptian president Hosni Mubarak as an ally.
US Secretary of State Hillary Clinton told reporters in Stockholm the threats against Israel were "nothing new," insisting she would judge Tehran by its actions at upcoming nuclear talks in Russia.
"We look forward to what the Iranians actually bring to the table in Moscow," she said.
"We want to see a diplomatic resolution. We now have an opportunity to achieve it, and we hope it is an opportunity that's not lost, for everyone's sake," she said.
Allegations that Iran was trying to develop atomic bombs were false, Khamenei said on Sunday.
"International political circles and media talk about the danger of a nuclear Iran, that a nuclear Iran is dangerous. I say that they lie. They are deceiving," Khamenei said.
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"What they are afraid of -- and should be afraid of -- is not a nuclear but an Islamic Iran."
He added: "They invoke the term 'nuclear weapons' based on a lie. They magnify and highlight the issue in their propaganda based on a lie. Their goal is to divert minds and public opinion from the (economic) events that are happening in the US and Europe."
Western economic sanctions imposed to pressure Iran to curb its nuclear programme were having no effect, Khamenei insisted. Their only impact, he said, was "deepening hatred and animosity of the West in the hearts of the Iranian people."
Khamenei called the stance by the United States and its Western allies "crazy."
"The Iranian people have proved they can progress without the United States, and while being an enemy of the United States," he said.
Western nations, the United States at the fore, accuse Iran of wanting to develop the capability to make nuclear weapons, something Khamenei has repeatedly denied. The supreme leader has called atomic arms "a great sin."
Talks between the Islamic republic and the so-called P5+1 group of nations -- the United States, Britain, France, Russia, China, plus Germany -- were revived this year and are to go to a crucial next round in Moscow on June 18-19.
But the United States and its ally Israel -- the sole, if undeclared, nuclear weapons state in the Middle East -- have threatened military strikes on Iranian nuclear facilities if diplomacy fails.
Khamenei's speech was being closely watched by P5+1 officials for signs of what positions the Iranian delegation might take into the Moscow negotiations. The supreme leader has the final word on any decision on Iran's nuclear activities.
At one point in his speech, Khamenei declared it "forbidden to stop on the path to progress, in the political sphere and in the sphere of science and technology."
That carried the implication that Iran had no intention on scaling back its nuclear development.