The missile Akash -- meaning sky in Hindi -- was tested at a range in eastern Orissa state.
It was fired at 11:15 am (0545 GMT) from a mobile launcher at the Chandipur-on-Sea testing range, 200 kilometres (125 miles) northeast of Bhubaneswar, Orissa's state capital, the ministry official said.
The 700 kilogramme (1,540 pound) missile, which hit a flying drone, was last tested on Friday.
Nuclear-armed rivals India and Pakistan, who came close to war in 2002 but whose relations have warmed since, frequently test-fire missiles.
Akash, which can track 100 targets simultaneously with onboard radar, can move at a speed of 600 metres (1,980 feet) a second and deliver a 55 kilogramme (121 pound) warhead across 27 kilometres (17 miles) in 50 seconds.
Akash is being developed by the state-run Defence Research and Development Organisation which launched in 1983 a project to build an array of weapons. It hopes to cap the programme with a ballistic missile which can fly 5,000 kilometres (3,100 miles).
In 1999, a year after India and Pakistan tested nuclear weapons, the two countries agreed to notify each other ahead of missile tests.