TEL AVIV, Israel — The Pentagon’s Missile Defense Agency (MDA) has agreed to extend joint testing and upgrades of the U.S.-Israeli Arrow interceptor , which successfully carried out its most challenging test yet Feb. 11.

The latest test, conducted at night over the Mediterranean Sea, featured the debut launch of the Arrow M-4 , the first interceptor missile jointly produced by prime contractor Israel Aerospace Industries Ltd. (IAI) of Lod and Chicago-based Boeing Co., its American partner.

The demonstration featured improved versions of Israel’s operational Block 3 Arrow Weapon System going up against a target designed to simulate the nuclear-tipped ballistic missiles expected to be deployed by Iran in the coming years. The intercept occurred at a higher altitude and a longer range than any previous Arrow test, which is important because in actual attack scenarios the goal is to minimize the chances of debris from destroyed nuclear, chemical or biological weapons landing on Israeli territory, officials here said.

“We widened the defensive envelope,” said Uri Sinai, manager of IAI’s MLM Division that designed and produces the Arrow interceptor. “What distinguished this test was the special target, which was simulated to represent the extreme, difficult conditions in which the Arrow Weapon System may have to operate in future.”

It was the first so-called distributed weapon system test conducted in-country, and required two Arrow units deployed some 100 kilometers apart to share data on incoming threats and coordinate launching assignments. It was also the first time the U.S. Link 16 data distribution system was used to connect two Arrow units, although the system had been used in previous tests to connect Arrow and Patriot missile defense batteries, sources here said.

According to program officials, both of the Arrow’s two operational Block 3 Green Pine radar successfully acquired and tracked the target almost immediately after it was launched from an Israel Air Force fighter many hundreds of kilometers away in the Eastern Mediterranean. Target data from one Arrow/Green Pine unit was used to direct the intercept, which was performed by a second unit deployed about 100 kilometers south near the coast in central Israel.

The entire process — from target acquisition to target destruction — took mere minutes, and demonstrated full fidelity of all elements of the integrated system, program officials here said.

“All test objectives were achieved in full. It marked an important milestone in our ability to defend against future threats operating under extreme conditions,” said Israel Air Force Col. Moshe Patel, deputy director of the Arrow Weapon System program at Israel’s Missile Defense Organization.

Uzi Rubin, the founding director of the Israel Missile Defense Organization, noted that from the very beginning, the Arrow was designed to defend against nuclear, biological or chemical missile attack. However, system improvements validated in recent years — and particularly in the Feb. 11 test — strengthen the Israeli defense establishment’s confidence in the Arrow’s protective capabilities.

“There’s always going to be a huge gap between what the engineers claim the system can do and what the users actually believe. What we’re now witnessing is a closing of this gap,” Rubin said. “The engineers and the users are now working together on operational systems that will kill targets as far, as high and as fast as possible.”

In a Feb. 13 interview, Patel said the latest test — the 15th for the Arrow interceptor and the 10th for the complete weapon system — validated improvements funded through the U.S.-Israel Arrow System Improvement Program (ASIP).

Established by the two governments in 2001, the ASIP development and testing program funds progressive upgrades to the Arrow and makes it interoperable with other U.S. land- and sea-based missile defense programs.

Plans originally called for ASIP to conclude in 2008, but the specter of increasingly advanced ballistic missile threats to both nations warranted renewal of the program, U.S. and Israeli sources said. In interviews here and in Washington, program officials said the U.S. Missile Defense Agency not only agreed to extend ASIP through 2009, but allocated significant funding through 2013 for so-called post-ASIP endeavors.

According to U.S. agency’s five-year spending plan, Israel is slated to receive $68.3 million in 2008 and $83.5 million in 2009 for Arrow upgrades and interoperability testing.

Additionally, the Missile Defense Agency has allocated approximately $80 million each year from 2010 through 2013 for post-ASIP activities, details and schedules, which will be determined by the two countries in the coming year.

“We’ve started discussions on the post-ASIP program, which will allow both countries to remain way ahead of the threats we’re likely to face in future,” Patel said.

Rick Lehner, a spokesman for the U.S. Missile Defense Agency, offered praise for the Arrow program in the wake of the test. “We are very pleased with the success of the Arrow program over many years, and our future funding plans will allow for the continued partnership with Israel to enhance and improve the Arrow system to ensure it can protect the people of Israel against hostile missile attack,” he said. “The technology used by Arrow has also helped the U.S. in our missile defense system development, and we look forward to continuing our cooperative and mutually beneficial program efforts in the years ahead.”

Meanwhile, Arrow program officials are planning to conduct yet another test by early April of an entirely new Block-4 version of the Arrow Weapon System. Sources here say the upcoming test will be limited to a flight of a new Arrow interceptor featuring improved acceleration, and will not involve destruction of a target.