Iranian Supreme Leader Ayatollah Ali Khamenei rejected Donald Trump's demand for unconditional surrender on Wenesday, and the US president said his patience had run out, though he gave no clue as to what his next step would be.
Speaking to reporters outside the White House, Trump declined to say if he had made any decision on whether to join Israel's bombing campaign against Iran.
"I may do it. I may not do it. I mean, nobody knows what I'm going to do," he said.
Trump warned that Iran's current leadership could fall as a result of the war. A change in Iran's government "could happen," he said.
Trump said Iranian officials had reached out about negotiations including a possible meeting at the White House but "it's very late to be talking," he said.
"Unconditional surrender, that means I've had it."
Asked for his response to Khamenei rejecting his demand to surrender, Trump said: "I say, good luck."
Iranians jammed highways out of the capital Tehran, a city of 10mn people, as residents sought sanctuary from intensified Israeli airstrikes.
In its latest bombing run, Israel said its air force destroyed Iran's police headquarters.
Israeli Prime Minister Benjamin Netanyahu, in a video released by his office, said Israel was "progressing step by step" towards eliminating threats posed by Iran's nuclear sites and ballistic missile arsenal.
He also thanked Trump, "a great friend of the state of Israel", for standing by its side in the conflict, saying the two were in continuous contact.
Khamenei, 86, rebuked Trump in a recorded speech played on television, his first appearance since Friday.
"Intelligent people who know Iran, the Iranian nation and its history will never speak to this nation in threatening language because the Iranian nation will not surrender."
A source familiar with internal discussions said Trump and his team were considering options that included joining Israel in strikes against Iranian nuclear installations.
Israel's military said 50 Israeli jets struck around 20 targets in Tehran overnight, including sites producing raw materials, components and manufacturing systems for missiles.
It advised Iranians to leave parts of Tehran for their own safety while it bombed targets.
In Israel, sirens rang out anew at dusk on Wednesday warning of further incoming Iranian missiles. There were no immediate reports of serious damage, while a motorist was injured by missile debris, Israeli medics said.
The army later advised civilians they could leave protected areas, signalling the threat had passed.
Since Friday, Iran has fired around 400 missiles at Israel, some 40 of which have pierced air defences, killing 24 people, all of them civilians, according to Israeli authorities.
Inside Iran, authorities are intent on preventing panic and shortages. Fewer images of destruction have been allowed to circulate than in the early days of the bombing. A ban on filming by the public has been imposed.
This image grab taken from footage broadcast by Iran's IRIBNEWS on Wednesday, shows the wreckage of what it said is an armed Israeli Air Force Hermes drone downed in the central city of Isfahan. AFP/IRIBNEWS
Members of the Israeli special forces check the apparent remains of an Iranian ballistic missile, in northern Israel, Wednesday.
Israeli air defence systems are activated to intercept Iranian missiles over the Israeli city of Tel Aviv early on Wednesday. AFP
Rocket trails are seen in the sky above the Israeli coastal city of Netanya amid a fresh barrage of Iranian missile attacks on Wednesday. AFP
Rocket trails are seen in the sky above the Israeli coastal city of Netanya amid a fresh barrage of Iranian missile attack on Wednesday. AFP