In a report destined for senators cited by Russian media, General Prosecutor Yury Chaika said 1.6 billion rubles ($24.7 million) was embezzled by companies headed by the state-run technology agency Rostec and space agency Roscosmos.

The funds were "intended for the modernisation of production capacities and the creation of some of the most advanced weapons," the document said.

Rostec, a public holding company with over 500,000 employees, oversees weapons manufacturers.

It confirmed the investigation against the holding company and said its own security services in 2018 helped "prevent damage in the amount of 3.4 billion rubles", the equivalent of $52.5 million.

Roscosmos said it had "actively contributed" to the prosecution's investigation.

The Kremlin on Tuesday said it will pay "great attention" to the companies concerned.

Russian opposition politician Alexei Navalny called the scandal an "unprecedented affair" on his Twitter account.

Several corruption scandals have hit Russia's defence and space sectors in recent years.

The sectors collapsed with the fall of the USSR but were revived under the leadership of President Vladimir Putin, who has lauded the "invincible" and "hypersonic" missiles currently being developed in Russia.

Corruption is endemic in Russia, where it is considered one of the main obstacles to economic development.