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Iran has warned the U.S. and Israel to expect a "devastating" response after accusing them of being involved in a deadly attack on a military parade in the country.

Saying the separatists who killed at least 25 people at an Iranian military parade are allied with the USA and Saudi Arabia, Ayatollah Ali Khamenei says those responsible "will certainly be severely punished". First an Arab Iranian separatist group, Ahvaz National Resistance, claimed responsibility.

Iran also warned the United Arab Emirates over "offensive remarks" attributed to a UAE "political adviser" following the attack.

Hossein Salami, deputy head of Iran's Revolutionary Guards, blasted the USA, promising "devastating" revenge.

"Based on reports, this cowardly act was done by people who the Americans come to help when they are trapped in Syria and Iraq, and are paid by Saudi Arabia and the UAE", Khamenei said on his website.

The coffins were draped in Iranian flags and mourners carried pictures of those killed, as well as banners saying "we will stand to the end" and "no to terrorism".

When asked whether that meant Trump would be willing to sit down with Iran's ayatollah, Pompeo replied, "The president said he'll talk with anyone if we can have a constructive conversation".

Translation: 10 military deaths in an attack on an Iranian military parade in the city of Ahvaz in southwestern Iran. He stressed the United States had no advance knowledge that such an attack was possible.

State TV hours later reported that all four gunmen had been killed, with three dying during the attack and one later succumbing to his wounds at a hospital.

Iranian officials have said they believed the gunmen had links to an "Ahvazi terrorist group".

A senior spokesman for the Iranian Armed Forces said four terrorists were involved in the attack, noting that they had hidden their rifles in the parade venue beforehand.

On June 7, 2017 in Tehran, 17 people were killed and dozens wounded in simultaneous attacks on the parliament and on the tomb of revolutionary leader Ayatollah Ruhollah Khomeini - the first inside Iran claimed by IS.

He said: "It is America who supports these little mercenary countries in the region".

"We stand with the Iranian people against the scourge of radical Islamic terrorism and express our sympathy to them at this awful time", said Heather Nauert, the U.S. State Department spokeswoman.

The Guard Corps was set up after the 1979 Islamic revolution to protect the Shi'ite clerical ruling system and revolutionary values.

The statements being made by Iran's leadership, including Supreme Leader Ayatollah Khamenei on Monday, have all reinforced the idea that regardless of which group carried out the attack, the support came from further overseas. Though many are expecting a tense reception from the American leader, Trump has suggested he would be open to meeting Rouhani on the sidelines of the United Nations events.