Media minister Nalinda Jayatissa said the second Iranian navy vessel was just outside Sri Lanka's territorial waters, but gave no further details.

President Anura Kumara Dissanayake was meeting top officials on Thursday to discuss a response to an Iranian request to enter the safety of the island's waters, official sources said.

They said the craft identified as IRIS Bushehr was carrying nearly 300 crew and cadets.

It was feared that this vessel could be targeted the same way a sister vessel was sunk by a US submarine just off Sri Lanka's southern coast on Wednesday.

The sinking of IRIS Dena came as the war sparked by a joint US-Israel attack on Iran continued to spread across the Middle East and beyond.

Iran's Foreign Minister Abbas Araghchi on Thursday denounced the attack and warned Washington it would "bitterly regret" establishing such a precedent.

"The US has perpetrated an atrocity at sea, 2,000 miles away from Iran's shores. Frigate Dena, a guest of India's Navy carrying almost 130 sailors, was struck in international waters without warning," he posted on X.

"Mark my words: The US will come to bitterly regret precedent it has set."

Sri Lanka's Foreign Minister Vijitha Herath said he spoke with Araghchi on Wednesday to "express grave concern" over the escalation of hostilities and called for diplomatic dialogue.

Meanwhile, authorities began an inquest into the deaths of the sailors at the southern port city of Galle while the chief magistrate Sameera Dodangoda ordered autopsies.

The morgue at Galle can handle about 25 bodies at a time, but those of the 84 Iranian sailors were brought there on Wednesday.

Hospital staff said the authorities were rushing to set up refrigerated shipping containers to preserve the remains until legal formalities were completed.

Navy spokesman Buddhika Sampath said authorities were continuing the search for missing sailors.

Sri Lanka earlier said that there were 180 people on board the ship -- more than the Iranian figure -- when it was struck by a torpedo, in what the US defence secretary called "quiet death".

- Tight protection -

Medical staff said 32 rescued Iranians were still being treated under tight security provided by police and elite commandos at the hospital, adding that the walking wounded would be discharged soon.

The International Committee of the Red Cross (ICRC) said it was assessing the situation and was working with the local authorities.

"Our priority is to ensure that all the wounded, sick and shipwrecked receive the assistance they are entitled to without delay," the ICRC spokesperson in Colombo, Ruwanthi Jayasundare, told AFP.

The emergency treatment unit of the district's main hospital was off-limits to visitors and other patients, with medical authorities setting up a separate ward for the wounded Iranians.

"Most of them have minor injuries, but there were a few with fractures and burns," a nurse at the hospital said, without giving her name.

An Iranian embassy official present at the hospital declined to comment.

The frigate issued a distress call at dawn on Wednesday but had completely sunk by the time a Sri Lankan rescue ship reached the area.

The attack was about an hour away from the main naval base in Galle.

The warship was returning after attending a military exercise in India's eastern port of Visakhapatnam.

India's Foreign Minister S. Jaishankar said he too had had a telephone conversation with his Iranian counterpart, but gave no details.

Sri Lanka has remained neutral and has repeatedly urged dialogue to resolve the conflict in the Middle East.

Iran is a key buyer of Sri Lankan tea, the country's main export commodity.