Israelis hailed Thursday the capture of an alleged Gaza-bound arms ship as a major coup in the fight to unmask Iran but thought it unlikely to scupper ongoing talks over Tehran's nuclear programme.

Israeli naval commandos seized the vessel Wednesday, with the military saying it was carrying an Iranian shipment of advanced missiles en route to the Hamas-run Gaza Strip.

The pre-dawn raid, which targeted a Panamanian-flagged ship in the Red Sea between Eritrea and Sudan, dominated the front pages of Israel's main newspapers Thursday.

The military said the vessel sailed 10 days ago, carrying Syrian-made missiles "capable of striking anywhere in Israel" that were transported overland to Iran then sent on by sea.

Pundits were quick to point out the raid coincided with a high-profile US trip by Prime Minister Benjamin Netanyahu to raise a red flag over talks between the P5+1 group of world powers and Iran.

But the military said the operation had been months in the planning.

Visiting the Simon Wiesenthal Center's Museum of Tolerance in Los Angeles Thursday, Netanyahu compared Iran's leadership to Nazi leader Adolf Hitler.

"He called then for the destruction of Israel and Iran today calls for the destruction of Israel,' Netanyahu said after being shown a document signed by Hitler.

"Then too there were people who did not want to believe his words. We shall not allow Iran to arm itself with the capability to destroy us," he said in remarks relayed by his office.

The vessel, the Klos-C, is being towed to Israel's Red Sea port of Eilat and is expected on Saturday evening, military spokesman Brigadier General Motti Almoz told army radio.

"From what we understand, it was carrying dozens of M302 long-range missiles which can reach 150 to 200 kilometres (90-125 miles). It may be carrying other weapons as well, but we can only know this when it reaches Eilat.

"There is clear and unequivocal information that this (shipment) came from Iran," Almoz said, without elaborating.

But military intelligence chief Major General Aviv Kochavi said Israel had "good, solid and incriminating evidence that Iran planned, managed and executed the arms smuggling," citing the involvement of Iran's Revolutionary Guards.

But he also offered no proof.

- 'Unmasking Iran' -

Iran has flatly denied any involvement with the shipment, which the Israeli army said was carrying missiles capable of striking anywhere in Israel.

"The claim of sending a ship carrying Iranian weapons to Gaza is not true," Deputy Foreign Minister Hossein Amir Abdollahian was quoted as saying by official IRNA news agency.

"This claim is merely based on the repetitive and unfounded lies of the Zionist media" aimed at derailing negotiations between world powers and Iran over its contested nuclear programme, he said.

Netanyahu challenged that.

"The Iranian government says it's all lies. In a few days the ship will reach Eilat and then we shall see who is a liar."

Sudan also denied any connection with the shipment, saying the vessel had been in international waters.

Hamas's armed wing, the Ezzedine al-Qassam Brigades, dismissed Israel's "propaganda" and distanced itself from the episode.

"The occupation's claims over the weapons ship has no basis or truth, and no link with the Palestinian resistance," it said.

"This Zionist claim is a new attempt to incite against (Hamas-ruled) Gaza, and is pre-prepared propaganda with the malicious intention of coercing support for the blockade against the Strip."

Commentators said the discovery was a major coup for Israel.

The operation took place as Netanyahu arrived in Los Angeles, just hours after giving a rousing speech to the powerful pro-Israel lobby AIPAC in Washington, raising the alarm over the world being supposedly being duped over Iran.

"This time the prime minister... showed perfect timing. A day after his AIPAC address and two days after his meeting with Obama, he could say to the world: 'Told you so,'" wrote commentator Sima Kadmon in top-selling Israeli daily Yediot Aharonot.

Israel has long accused Iran and Syria of providing military aid to Hezbollah and to Palestinian militants.