Turkey denied on Thursday a US newspaper report claiming it had revealed an Israeli spy ring working with Iranians on its soil to the authorities in Tehran, a sign of the souring ties between the once-close allies.

Turkey is a regional power and there are power centres which are uncomfortable with this... stories like these are part of a campaign. Turkish official,

Washington Post columnist David Ignatius said Prime Minister Recep Tayyip Erdogan's government had last year revealed to Iranian intelligence the identities of up to 10 Iranians who had been meeting in Turkey with Mossad handlers.

But Turkish Foreign Minister Ahmet Davutoglu said the allegations were "without any foundation".

"[Turkish intelligence chief Hakan] Fidan and other security agents report only to the Turkish government and the parliament," he said.

The allegation angered officials in Ankara, already on the defensive after a Wall Street Journal article last week suggested Washington was concerned that Fidan had shared sensitive information with Iran.

Other officials in Ankara, speaking on condition they not be named, described the article as part of an attempt to discredit Turkey by foreign powers uncomfortable with its growing influence in the Middle East.

"Turkey is a regional power and there are power centres which are uncomfortable with this... stories like these are part of a campaign," a Turkish official said, asking not to be identified because of the sensitivity of the subject.

'Very complex'

There was no immediate comment from Israel, but Israeli ministers have accused Erdogan of adopting an anti-Israeli stance in recent years. Deputy Israeli Foreign Minister Zeev Elkin declined to comment on the report, but said relations with Turkey were "very complex."

"The Turks made a strategic decision ... to seek the leadership of our region, in the Middle East, and they chose the convenient anti-Israeli card in order to build up leadership," he told Israel Radio.

The relationship hit the rocks in 2010 after Israeli commandos killed nine Turkish activists seeking to break Israel's long-standing naval blockade of the Gaza Strip.

Relations between the two US allies have been fraught ever since, with military cooperation frozen and mutual distrust scuppering attempts to restore ties, despite efforts by US President Barack Obama to broker a reconciliation.

Iran has long accused Israel of spying on it soil and of killing several Iranian nuclear scientists, the last in January 2012.

In April 2012, Iran announced that it had broken up a large Israeli spy network and arrested 15 suspects. It was not clear if this was connected to the alleged Turkish leak.