The Iranian news agency Tasnim reported Saturday night that the security directorate in the west of the country arrested a "spy cell that worked for Israel."
The network acted to "recruit rioters, with the aim of sending sabotage operations inside Iran."
The report from Iran comes as 12 missiles were launched at the American consulate in Erbil in northern Iraq on Saturday night.
There were no casualties or damage to U.S.-owned facilities in the area. A State Department spokesman called it a "scandalous provocation."
A report on official Iranian TV alleged that the attempted strike was intended to target "secret Israeli bases" in Iraq. According to pro-Iranian sources, Fateh 110 missiles were used in the attack.
No casualties were reported in the attack.