Israel's prime minister has accused Iran of carrying out a missile test in "flagrant violation" of a UN security council resolution.
Benjamin Netanyahu said he would discuss renewing sanctions when he met US President Donald Trump in February.
Iran has carried out several such tests since a 2015 nuclear deal which relaxed sanctions against the country, despite Western criticism.
The White House said it was studying the details of the incident.
"Iranian aggression must not go unanswered", Mr Netanyahu added.
US officials, speaking on condition of anonymity, said the missile had broken up before the test was completed.
It is not yet clear what type of missile was launched, or if it explicitly violated the UN resolution.
The resolution calls on Iran not to undertake any activity related to "ballistic missiles designed to be capable of delivering nuclear weapons".
Iran says it does not have any nuclear weapons.
But US Senator Bob Corker, chairman of the foreign relations committee, said: "No longer will Iran be given a pass for its repeated ballistic missile violations."
Mr Trump has previously called the Iran nuclear deal "a disaster" and suggested his administration will abandon it.
But that has drawn criticism from senior figures, including the former director of the Central Intelligence Agency, John Brennan.
Mr Brennan, who stepped down when President Trump took office, told the BBC
late last year that tearing up the agreement "would be the height of folly" and "disastrous".
But Mike Pompeo, who has succeeded Mr Brennan as director of the CIA, was a prominent critic of the deal.