President Donald Trump has warned Iranians that “bombs will be dropping everywhere” as the US and Israel launched a joint attack, vowing to end the country’s “wicked” regime.

Co-ordinated military strikes began hitting locations across Iran on Saturday (AEDT), including the compound of Iran’s supreme leader Ayatollah Ali Khamenei.

Iran responded with a volley of missiles aimed at Israel and neighbouring Gulf countries, including Dubai, Doha, Bahrain and Kuwait — allies of the US that host American bases.

Airlines suspended flights across the Middle East, including to and from the world’s busiest travel hub, Dubai.

In breaking news on Sunday morning (AEDT), there were suggestions that Iran’s supreme leader had been killed in the strikes and that his body had been recovered from the rubble.

Israel President Benjamin Netanyahu said Khamenei’s compound had been destroyed, and Revolutionary Guard ‌commanders and senior ‌nuclear officials ⁠had been destroyed.

Explosions have been reported across central Tehran. Photo: AAP

Announcing the strikes, Trump said he would never let Iran have nuclear weapons and urged the Iranian people to seize the opportunity to rise up and “take over your government”.

Trump said Iran posed a threat to the US and the world which was why he was taking this moment to launch a “massive and ongoing operation”.

“We’re going to destroy their missiles and raze their missile industry to the ground. It will be totally again obliterated. We’re going to annihilate their navy,” he said in an eight-minute video posted to social media.

“To the members of the Islamic Revolutionary Guard, the armed forces and all of the police, I say tonight that you must lay down your weapons and have complete immunity.

“Or in the alternative, face certain death. So, lay down your arms. You will be treated fairly with total immunity, or you will face certain death.

“Finally, to the great proud people of Iran, I say tonight that the hour of your freedom is at hand. Stay sheltered. Don’t leave your home. It’s very dangerous outside. Bombs will be dropping everywhere.

“When we are finished, take over your government. It will be yours to take. This will be probably your only chance for generations.”

Rubble remains in the aftermath of an Israeli-U.S. strike in Tehran. Photo: AAP

In cities across Iran, explosions caused widespread panic.

Residents rushed to collect ‌children from school and flee areas that might be targeted.

“We are scared, we are terrified. My children are shaking, we have nowhere to go, we will die here,” mother-of-two Minou, 32, said.

Iran issued a warning to shipping that the Strait of Hormuz, the narrow passage through which around a fifth of global oil consumption passes, had been closed.

Traders expected a sharp jump in oil prices. Airlines cancelled flights in the Middle East.

Tehran promised a stronger response to come, with a senior Iranian Revolutionary Guards commander, Ebrahim Jabbari, saying it had so far used only “scrap missiles” and would soon unveil unforeseen weapons.

The UN Security Council Secretary-General Antonio Guterres called for an immediate cessation of hostilities.

Israel’s military said its pilots had hit hundreds of targets throughout ‌Iran, including strategic defence systems already damaged ‌in strikes last year.

It said three sites ⁠where leaders had been meeting were struck simultaneously, and several senior figures were killed.

Iran’s Defence Minister Amir Nasirzadeh and Revolutionary Guards commander Mohammed Pakpour were killed in the Israeli attacks, sources said.

The first wave of strikes in what the Pentagon named “OPERATION EPIC FURY” mainly targeted Iranian officials, a source familiar with the matter said.

A girls’ primary school in the southern Iranian town of Minab was hit, killing 85 people, according to the local prosecutor cited by state media. Reuters could not independently confirm the reports.

The strikes by the US create a dilemma for its democratic allies.

While European leaders firmly oppose Iran’s nuclear program and crackdowns by its hard-line theocracy, they are loath to embrace unilateral military action by Trump that could breach international law and unleash a broader conflict.

Trump’s strikes on Iran last June and the arrest of Venezuela’s Nicolas Maduro last month caused a similar quandary.

It was unclear whether US allies were given any advanced warning of the attacks.

Oil markets have been closely watching the stand-off between Washington and Tehran ‌to try and determine if supplies will be impacted.

Jorge Leon, head of geopolitical analysis at Rystad Energy, predicted prices could shoot up by $US10-$US20  ($14-$28) per barrel when markets open on Monday unless there were signs of de-escalation.

Iran, the third-largest producer in the Organisation of Petroleum Exporting Countries, pumps about four per cent of global oil supplies, and a far larger share is shipped past its coast through the strait leading out of the Gulf.

Iran’s Revolutionary Guards said all US bases and interests in the region were within Iran’s reach and that Iran’s retaliation would continue until “the enemy is decisively defeated”.

-with AAP