Deputy Defense Minister Ahmad Vahidi made the announcement on Tuesday and described the development as "an important achievement," the Fars news agency reported.
"However, we cannot disclose the details of this project at present," the official said.
The reported range of 1,000 kilometers (600 miles) would make it possible for the Iranian drone to reach Israel.
Iran launched a domestic arms development program after a U.S. weapons embargo was imposed during its 1980-88 war with Iraq. Since 1992, Iran has reportedly produced its own Saeqeh and Azarakhsh jet fighters, stealth-capable Ghadir submarine, missile boats, torpedoes, tanks and armored carrier vehicles.
Iranian Defense Minister Mostafa Mohammad Najjar said on January 27 that Iran had achieved self-sufficiency in manufacturing combat missiles of various modifications.
He added that Iran would continue to build up its defense capability to ensure regional stability and security.
"Our greater defense power is no threat to other countries," he said. "Iran only needs a system to deter and repulse possible external aggression against it."
Both Israel and the United States have refused to rule out the possibility of military action against Tehran over its failure to obey international nuclear non-proliferation demands. (Moscow hosts UAV exhibition - Image gallery)