Iran has launched missiles at a mock-up of a US aircraft carrier in the strategic Strait of Hormuz.
The drill included fire so heavy that the US military temporarily put two regional bases on alert.
The US navy condemned the "irresponsible and reckless behaviour by Iran", labelling it an attempt "to intimidate and coerce".
The exercise comes at a time of increased tension between Tehran and Washington in the Gulf waters.
The drills - named Prophet Mohammed 14th - were broadcast on state television.
The mock-up - which resembles a carrier the US routinely sails into the Gulf - is shown with dummy fighter jets on either side of its landing strip. Missiles are then launched from a variety of angles, including some aimed at the carrier.
Another missile fired from a helicopter appears to hit the side of the fake warship.
"What was shown today in these exercises, at the level of aerospace and naval forces, was all offensive," Iran's Revolutionary Guards commander Major General Hossein Salami told state television.
Ballistic missile fire was detected and led to American troops being put on alert in the UAE and Qatar, the US military said.
"The US Navy conducts defensive exercises with our partners promoting maritime security in support of freedom of navigation; whereas, Iran conducts offensive exercises, attempting to intimidate and coerce," said Commander Rebecca Rebarich, spokeswoman for the US Navy's Bahrain-based Fifth Fleet.
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