US President Donald Trump vetoed an Israeli plan to assassinate Iranian supreme leader Ayatollah Ali Khamenei, a senior US official told AFP Sunday.

"We found out that the Israelis had plans to hit Iran's supreme leader. President Trump was against it and we told the Israelis not to," said the US official, speaking on condition of anonymity.

Earlier Sunday, Israeli Prime Minister Benjamin Netanyahu dodged a question about reports that Trump had asked his country not to kill Khamenei.

"I'm not going to get into that," he told Fox News.

"But I can tell you,... we'll do what we need to do, and I think the United States knows what is good for the United States," he said.

The comments came as Israel and Iran exchanged another barrage of missiles Sunday, with residents told to seek shelter as booms were heard over Jerusalem, and aerial defense systems reportedly activated in Tehran. 

After decades of enmity and a prolonged shadow war fought through proxies and covert operations, the latest conflict marked the first time the countries have traded fire with such intensity, triggering fears of a lengthy conflict that could engulf the entire Middle East.

It began Friday, when Israel launched an attack that has killed top military commanders and nuclear scientists, and struck military bases, nuclear sites and residential areas across the country.

As Israel struck targets across Iran again on Sunday, Netanyahu vowed to make the country pay a "heavy price" for killing Israeli civilians.

He also strongly suggested to Fox News that Israel had killed Iran's intelligence chief Mohammad Kazemi, saying it had recently "got the chief intelligence officer and his deputy in Tehran" as its jets carried out raids over the capital.

Trump has insisted that Washington, a strong ally of Israel, "had nothing to do" with Israel's bombing campaign.

But he also threatened to unleash "the full strength and might" of the US military if Iran attacked US interests, later urging the two foes to "make a deal."

Trump stressed to ABC News Sunday that the United States is "not at this moment" involved in the military action, but said it was "possible we could get involved."

He also said he would be "open" to his Russian counterpart Vladimir Putin being a mediator to resolve the conflict.