Harsh rhetoric has been common between the two rivals since January but the remarks by Revolutionary Guard Gen. Qassem Soleimani's take things to an entirely different level by discussing Saudi King Salman being killed.
Meanwhile, Iran already has warned Saudi Arabia to stay away from its territorial waters as heavily armed Saudi frogmen and warships take part in the Gulf Shield 1 drill across the larger Persian Gulf, adding to the tensions between the two rival Mideast powers.
Shiite power Iran supports embattled Syrian President Bashar Assad's government in his country's civil war, now in its sixth year, while Sunni-ruled Saudi Arabia supports opposition fighters trying to oust Assad.
Soleimani, head of the paramilitary force's expeditionary Quds force, referred to Saudi Deputy Crown Prince Mohammed bin Salman while talking about the Syrian war.
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He alleged the deputy crown prince told Syrian officials in a meeting also attended by Russians that "if you do not have ties with Iran, everything will end" - apparently meaning that the conflict would end.
The young Saudi deputy crown prince and defence minister, whose father put him as third in line to the throne in April 2015, has been viewed as ambitious for proposing economic initiatives in the kingdom and helping lead its ongoing war in Yemen.
But Soleimani's suggestion of the young royal committing regicide is likely to be met with anger in Saudi Arabia, which saw King Faisal assassinated by his nephew in 1975. There was no immediate reaction today in Saudi state media.
Soleimani's comments come as Saudi Arabia conducts its naval exercise in the Gulf, including waters Iran considers part of its sphere of influence.