The Israeli premier issued the warning after the comments made by the International Atomic Energy Agency Yukiya Amano on Iran's increased uranium enrichment.
"Israel will not allow Iran to develop nuclear weapons," Netanyahu said in a video statement, adding such weapons threaten Israel's "existence and endanger the entire world."
Known for his hawkish policies, Netanyahu further responded to the comments made by Iranian Foreign Minister Mohammad Javad Zarif on the atomic threat posed by Israel's nuclear program.
"You should ask a regime possessing nuclear weapons about how Netanyahu stands next to the Dimona, a nuclear weapons site, and says Iran should be destroyed," the Times of Israel cited Zarif as saying said at a press conference in Tehran on Monday.
"Zarif is lying," Netanyahu said. "Iran is the one that openly threatens, every day, to destroy the State of Israel. Iran continues to entrench itself militarily in Syria."
Amano told reporters in Vienna that Tehran's low-enriched uranium "production rate is increasing," adding it was not clear yet if it has surpassed the limitations set in the nuclear deal between Iran and the world powers.
Netanyahu has been a long-time vocal opponent of the 2015 deal to curb Iran's nuclear program.