Iran's foreign ministry said the country was not linked to a group of alleged spies arrested in Saudi Arabia, Iranian media reported on Sunday.
Saudi Arabia said on Tuesday that it had detained an Iranian, a Lebanese, and 16 Saudis for spying. Political analysts and press in Sunni Muslim Saudi Arabia have accused Shi'ite Iran of being behind the alleged espionage.
The two countries are locked in a struggle for influence across the region, backing opposing sides in Bahrain, Yemen, Syria, Lebanon and Iraq. Gulf Arab foreign ministers, meeting in Riyadh last month, issued a statement condemning what they said was Iranian "meddling" in their countries - an accusation Tehran rejects.
Iran's foreign ministry spokesman, Ramin Mehmanparast, denied that an Iranian national was involved in the alleged spy ring and called the allegations a "repetitive scenario", according to Iran's English-language Press TV on Sunday.
"Raising such baseless issues at the media level is merely for domestic consumption," he said, according to Press TV.
Leaders of Saudi Arabia's Shi'ite minority have also criticised the arrests of 16 members of their community, which they said sought to exploit sectarian tension.
The Saudi government has previously blamed unrest among Shi'ites in the Qatif district of oil-producing Eastern Province on an unnamed foreign power, which officials privately acknowledge means Iran - a charge local Shi'ite activists have denied. Sixteen people have been killed in Qatif in clashes with police in the past two years.
Riyadh also accuses Tehran of having masterminded an alleged plot to assassinate its ambassador in Washington that was announced by U.S. police in late 2011. Iran denies this.
Kuwait said in 2010 it had uncovered an Iranian spy ring, Yemen said last year it had arrested Iranian spies and that Tehran was backing rebels in the north, and Bahrain has accused Iran of plotting attacks on its territory. Tehran has denied all these charges.