Further tests are expected before the system, which is being developed together with the US, can be deployed.
It is the latest layer in Israel`s system of shields, designed to protect it from external threats.
The Lebanese militant group Hezbollah, which fought a war with Israel in 2006, is reported to have more than 100,000 missiles and rockets which can reach anywhere in Israel.
Iran, which calls for Israel`s eradication, also has missiles which can reach Israel and beyond.
The Israeli defence ministry hailed Thursday`s test as a "major milestone".
A similar test a year ago failed because the system was not able to lock on to the target.
Israel`s missile shield also includes the already-deployed "Iron Dome" system that targets short-range rockets fired by Palestinian militants in the Gaza Strip, and the mid-range "David`s Sling" that is close to being operational and will target missiles supplied to Hezbollah by Iran.
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