Israeli army chief, Lieutenant General Benny Gantz, warned on Wednesday that those who believe they can "eradicate" Israel will face the brunt of Israeli power, in a veiled threat to Iran.

"These days, the state of Israel and its residents are being threatened. These threats indicate a mistaken evaluation of our strength and capabilities," he said at a ceremony in memory of fallen soldiers.

"Those who believe they can eradicate Israel and act on these beliefs will face the brunt of the IDF power," he added, according to a military statement.

Gantz said the Israeli army was ready and "prepared along our country's borders" to thwart any such threats.

Gantz's remarks come just days after Iran's supreme leader Ayatollah Ali Khamenei said that the "cancerous tumour" of Israel is the biggest problem confronting Muslim countries today.

In a speech marking Eid al-Fitr, the end of the Muslim holy month of Ramadan, Khamenei said "the big powers have dominated the destiny of the Islamic countries for years and... installed the Zionist cancerous tumour in the heart of the Islamic world," according to Iran's official IRNA news agency.

"Many of the Islamic world's problems come from the existence of the sham Zionist regime," he was quoted as saying.

And last week Iranian President Mahmoud Ahmadinejad also told an annual anti-Israel protest in Tehran that the Jewish state was a "cancerous tumour" that will soon be excised, drawing Western rebukes.

"The Zionist regime and the Zionists are a cancerous tumour," he said.

"The nations of the region will soon finish off the usurper Zionists in the Palestinian land.... A new Middle East will definitely be formed. With the grace of God and help of the nations, in the new Middle East there will be no trace of the Americans and Zionists," Ahmadinejad said.

Khamenei and Ahmadinejad have long used the word "tumour" to portray Israel as an illegitimate state in the Middle East that will inevitably disappear.

Their expressions have often met with condemnation from world leaders.

Tensions between Israel and Iran are taut because of threats by the Jewish state to attack nuclear facilities in the Islamic republic to prevent it reaching the capability to produce nuclear weapons.

Israel and its ally, the United States, accuse Iran of seeking to develop an atomic arsenal.

Tehran denies this, and says its nuclear programme is exclusively peaceful. Its military chiefs warn they will destroy Israel if it attacks.

US State Department spokeswoman Victoria Nuland meanwhile said diplomacy can still solve the crisis, adding that it had relayed the message to Israel.

"We are focused on trying to have this dual-track policy of diplomacy backed by pressure work. And we are still focused on that," she told reporters.

"We are focused on combining diplomacy and pressure, trying to get Iran to be serious at the negotiating table and we are in full consultations with the Israelis about the picture that we see, and we will continue to make those points clear," Nuland said.

"But we have made absolutely clear to them that our view is that there is still time for diplomacy to work."

The spokeswoman stressed, however, that Israel's security was of "paramount concern" to the United States.

Her remarks came as UN Secretary-General Ban Ki-moon announced Wednesday that he would attend a Non-Aligned summit in Tehran next week, despite protests by Israel and calls by the United States to shun the event.

Ban plans to "convey the clear concerns and expectations of the international community" on Iran's nuclear programme, terrorism, human rights and the civil war in Syria, UN spokesman Martin Nesirky said.

Israel's Prime Minister Benjamin Netanyahu told Ban this month he would be making "a big mistake" if he attended the summit.

US Ambassador to the United Nations Susan Rice also advised the UN leader against going, diplomats said. Nuland, meanwhile, said it would be "strange" for Ban to attend the summit.