An Israeli official quoted the head of the military intelligence research division, General Yossi Beidetz, as telling the weekly cabinet meeting that Syrian President Bashar al-Assad was "preparing his forces for a military conflict" with Israel.

"Syria has accelerated the production of long-range missiles and has deployed anti-tank rockets on its border with Israel," which runs along the occupied Golan Heights, Beidetz said.

A military source told AFP he believed Syria wants to incorporate lessons learned from the July-August war between Israel and Lebanon's Hezbollah militia, which put up stiff resistance to the Jewish state.

"Syria has learnt a lot from Hezbollah which managed to inflict a lot of damage to Israeli forces, especially its tanks and armoured vehicles, by using guerrilla warfare," he said.

The warning came days after a report by a high-level US panel recommended Israel relaunch peace talks with Syria, which have been frozen since 2000.