Israel's Prime Minister Naftali Bennett held talks with Abu Dhabi Crown Prince Sheikh Mohammed bin Zayed al-Nahyan on Monday in the first ever public meeting between an Israeli leader and the United Arab Emirates' de facto ruler.

Israel's ambassador to Abu Dhabi said the issue of Iran was on the agenda for their talks, which follow the formalisation of Israel-UAE relations last year under a US-led regional initiative.

While shared concern about Iranian activity was among the reasons for the diplomatic moves, the UAE has also been trying to improve relations with Tehran.

Releasing photographs of Bennett and Sheikh Mohammed smiling and shaking hands, the Israeli leader's office described the meeting as "historic".

Israeli Ambassador Amir Hayek declined to elaborate on any discussion of Iran but he told Israel's Army Radio: "The prime minister did not only come here solely to address the Iranian issue."

With world powers now trying to renew the Iran nuclear deal, Abu Dhabi last week sent an envoy to Tehran. A US delegation is due in UAE this week to warn Emirati banks against non-compliance with sanctions on Iran.

Iran is Israel's arch-foe, but it has not been mentioned publicly by Bennett since he set off on Sunday for the first visit by an Israeli premier to UAE with pledges to promote bilateral commerce and other forms of civilian cooperation.

The Israel Hayom newspaper, quoting unnamed officials, said Bennett was expected to brief Sheikh Mohammed on intelligence regarding Iranian-supplied militias and drones in the region.

Israel last month broached setting up joint defences against Iran with Gulf Arab states. Hayek said military sales to UAE are in the works, though Israeli industry sources say advanced Israeli air defence systems have yet to be offered.

"Israel is in cooperation with a new friend, with a partner for the long-term, and the considerations will be both considerations of defence and also considerations of how you work with a country which is very, very, very friendly to Israel," Hayek said.

Israel-UAE bilateral trade in goods alone reached nearly $500 million so far in 2021 — up from $125 million in 2020 — and is expected to continue growing rapidly.