The Egyptian authorities have agreed to allow two Iranian warships to transit through the Suez Canal to the Mediterranean Sea, state media report.
Iran's request stated the vessels would have no military equipment, nuclear materials or chemicals on board, the defence ministry is quoted as saying.
Iranian officials say the warships are headed to Syria for training.
Israel's foreign minister has expressed concern about them using the Suez Canal, calling it a "provocation".
There has been no comment from Israel since Egypt gave its approval.
It is believed to be the first time since Iran's 1979 Islamic Revolution that Iranian warships have attempted to pass through the Suez Canal.
The ships involved are the frigate Alvand and a supply vessel, the Kharg. They are currently in the Red Sea, at the canal's southern end.
Iran's semi-official Fars news agency reported in January that Iranian navy cadets were going on a year-long training mission through Suez and into the Mediterranean, according to the Reuters news agency.
Analysts say the request for transit would have presented a headache for the military council that has ruled Egypt since President Hosni Mubarak stepped down last week. Cairo signed a peace treaty with Israel in 1979 and has since had frosty ties with Tehran.
However, a Suez Canal official said Egypt could only have denied transit through the strategic waterway in case of war.
Israeli considers Iran an existential threat because of its controversial nuclear programme, development of ballistic missiles, support for Lebanese and Palestinian militant groups, and promises to destroy Israel.
Earlier this week, Israeli Foreign Minister Avigdor Lieberman said: "To my regret, the international community is not showing readiness to deal with the recurring Iranian provocations. The international community must understand that Israel cannot forever ignore these provocations."
In other news, Egypt announced earlier on Friday that it would reopen the Rafah crossing on its border with the Gaza Strip.
Egyptian state TV reported that the border was being re-opened to allow stranded Palestinians to cross. The announcement did not say if goods would be allowed to be taken through.