The US Treasury Department alleged Iraj Masjedi was a "close adviser" to Qassem Soleimani, Iran's most powerful general, who was killed in January by a US strike.

The sanctions come as Washington's outrage has grown over a series of rocket attacks against US interests in Iraq, which have been blamed on pro-Iranian factions.

"Masjedi has overseen a program of training and support to Iraqi militia groups, and he has directed or supported groups that are responsible for attacks that have killed and wounded US and coalition forces in Iraq," said a Treasury statement.

Masjedi has used his role as Tehran's ambassador to Baghdad to "obfuscate financial transfers" benefitting the Revolutionary Guards, it added.

"The Iranian regime threatens Iraq's security and sovereignty by appointing (Revolutionary Guards) officials as ambassadors in the region to carry out their destabilizing foreign agenda," Treasury Secretary Steven Mnuchin said in a statement.

The US has re-imposed sanctions against Tehran since President Donald Trump pulled out of the international deal to prevent the Islamic Republic from developing nuclear weapons.

The Trump administration has pushed its "maximum pressure" campaign against Iran, in the aim of pushing Tehran to accept a new deal.

But Iran has refused talks without sanctions being lifted first.

Washington's pressure campaign has also targeted Tehran's allies in the region, including Lebanon's Hezbollah movement, which Washington considers a terrorist organization.

Under the sanctions, all property and interests of Masjedi that are under US jurisdiction are blocked and Americans are prohibited from having dealings with him.