US ambassador to the United Nations Nikki Haley said that a missile fired by Yemen's Houthi group towards Saudi Arabia on Tuesday "bears all the hallmarks of previous attacks using Iranian-provided weapons" as she pushed the UN security council to act.
Saudi air defenses shot down the ballistic missile and there were no reports of casualties or damage.
Saudi-led forces, backing Yemen's government, have fought the Iran-allied Houthis in Yemen's more than two-year-long war. Iran has denied supplying the Houthis with weapons, saying the U.S. and Saudi allegations are "baseless and unfounded."
"We must all act cooperatively to expose the crimes of the Tehran regime and do whatever is needed to make sure they get the message. If we do not, then Iran will bring the world deeper into a broadening regional conflict," Ms Haley told the council.
Ms Haley said she was exploring, with some council colleagues, several options for pressuring Iran to "adjust their behavior." However, she is likely to struggle to convince some members, like veto powers Russia and China, that UN action is needed.
Russia's Deputy UN ambassador Vladimir Safronkov told council on Tuesday: "We need to abandon the language of threats and sanctions and to start using the instruments of dialogue and concentrate on broadening cooperation and mutual trust."
Most sanctions on Iran were lifted at the start of 2016 under the nuclear deal brokered by world powers and enshrined in a U.N. security council resolution. The resolution still subjects Tehran to a UN arms embargo and other restrictions that are technically not part of the nuclear deal.
Haley said the security council could strengthen the provisions in that resolution or adopt a new resolution banning Iran from all activities related to ballistic missiles.
Under the current resolution, Iran is "called upon" to refrain from work on ballistic missiles designed to deliver nuclear weapons for up to eight years. Some states argue that the language of the resolution does not make it obligatory.
"We could explore sanctions on Iran in response to its clear violations of the Yemen arms embargo," Ms Haley said. "We could hold the IRGC (Iran's Islamic Revolutionary Guard Corps) accountable for its violations of numerous Security Council resolutions."
A separate UN resolution on Yemen bans the supply of weapons to Houthi leaders and "those acting on their behalf or at their direction."
Saudi Arabia shot down the ballistic missile on Tuesday.
"Ballistic missile intercepted over Riyadh," the Saudi-led coalition battling Yemen's Houthi rebels on behalf of the internationally-recognised Yemeni government said.
The rebels said the target was Al Yamama Palace, the official residence of King Salman located in the western suburbs of the capital. It is also the headquarters of the Royal Court.
On Twitter, the government-run Centre for International Communication said there were no reported casualties.
Meanwhile, Saudi Arabia's Al Arabiya television said there was no property damaged in the incident, footage of which people was posted on social media by Saudis.
The UAE strongly condemned the "cowardly" missile launch, and emphasised its "full support" for Saudi Arabia against those who try to undermine its security.
An official statement on state news agency WAM said: "This cowardly attack draws attention to the dangerous and negative role played by Iran in supporting the coup militia and its insistence on continuing its hostile practices by providing the Houthi terrorist group with ballistic missiles that threaten peace and security in the region."
The statement added that the UAE "[reiterates] its unwavering commitment to the Saudi-led Arab Coalition to achieve security and stability in brotherly Yemen, fully aware of the relationship between this goal and the security and stability of the region."
Read more: Yemen rebel missile shot down by Saudis, UN says weapons are likely Iranian
One video showed smoke and the missile that had been intercepted by Patriot anti-missile batteries purchased from the US.
It was the third ballistic missile fired at the kingdom from Yemen in the past two months. On November 4, Saudi Arabia shot down a missile near King Khaled International Airport on the northern outskirts of the capital. Another missile was intercepted and destroyed in the south-western city of Khamis Mushait on November 30.
The Saudi-led military coalition fighting in Yemen, which includes the UAE, is battling the Iran-supported Houthis to restore the legitimate government of Yemeni president Abdrabu Hadi Mansur.
In a televised address, Houthi leader Abdul-Malik Al Houthi said the range of missiles in the Houthi arsenal was being extended, Associated Press reported.
"As long as you continue to target Sanaa we will strike Riyadh and Abu Dhabi," he said.
Earlier this month, the Houthis claimed they had fired a cruise missile at the UAE's Barakh power plant, which is set to begin operating next year. But the UAE denied there had been any such attack.
The Houthis captured the Yemeni capital, Sanaa, in September 2014 and later advanced south, seizing large swathes of the country and forcing Mr Hadi's government to relocate to the southern city of Sanaa.
The coalition launched its intervention in March 2015 and since helped pro-government forces to recapture much of the south of the country from the rebels. The Houthis still hold large parts of the north, however.
The latest missile strike comes just weeks after an alliance between the rebels and former Yemeni president Ali Abdullah Saleh and his supporters broke down. Saleh and the Houthis formed an uneasy partnership in 2014 but cracks began to emerge earlier this year. Tensions came to a head at the end of last month with fierce fighting breaking out on the streets of Sanaa between the two sides, with saleh ultimately being killed by Houthi fighters on December 4 as he tried to flee the capital.
Since then the rebels have launched a crackdown against members of Saleh's General People's Congress party, with one GPC leader claiming on Monday night that 1,200 members had so far been killed by the Houthis.
Kamel Al Khoudani, who is also secretary of the GPc's official Al Mithak newspaper, said on Twitter that 3,000 party members had also been arrested by the rebels, while 50 party offices had been looted.
Many GPC members have reportedly fled the capital and other Houthi-held areas amid the crackdown.
On Tuesday, Al Shulaif tribe became the first tribe in the district of Nehem, to the north of Sanaa, to break its alliance with the Houthis and declare its allegiance to Mr Hadi's government.
Colonel Abdolgalil Al Barati, a commander of one of the government's military bases in Nehem, told The National in a phone call that the tribe — which is one of the most prominent in the areas surrounding Sanaa to the north — had said its members would now fight the rebels alongside the Yemeni army.
"Al Sheikh Ahmed Al Shulaif, a leader in the GPC party, decided to join the Yemeni army troops with all his tribe members and they are fighting with us now," Col Al Barati added.
It came as Mr Hadi said military options against the Houthis would not end until all provinces had been liberated from rebel control.
At a meeting in the Saudi capital of a group of 19 nations supporting Mr Hadi's government, the Yemeni president insisted that no dialogue with the Houthis could take place unless it was based on the rebels giving up all arms and handing back control of all state institutions to his government.