"We have been producing drones in Lebanon for a long time, and whoever wants to buy them, submit an order," Sayyed Hassan Nasrallah said in a televised speech to followers.

He said Hezbollah was able to transform standard rockets into precision missiles with the cooperation of "experts from the Islamic Republic of Iran". Such production had been spurred by arch-foe Israel's increased use of drone technology, he said.

Hezbollah and Israel fought a month-long war in 2006 and have at times in the years since traded fire across Lebanon's southern border.

There was no immediate Israeli response to Nasrallah's statements. While the Israeli military outguns Hezbollah guerrillas, Israel worries that in a future war they could use precision-guided missiles to knock out parts of its national infrastructure like ports or power stations.

Israel has said in the past that it has brought down several Hezbollah drones that had crossed into Israeli air space. Hezbollah says its increased anti-drone capabilities have led to a decline in Israeli drone overflights.

Israel last week published the names of three Lebanese companies that it accused of supplying materials for Hezbollah's precision-guidance missile project, a move designed to generate international economic pressure on the Shi'ite Muslim group.

"Hezbollah are endangering the citizens of Lebanon and the state of Lebanon," Israeli Defence Minister Benny Gantz said in a statement. Israel, he added, would "act resolutely in the face of the Iranian precision project operating from the heart of Lebanon".