Flynn said that Iran's launch of a ballistic missile as part of a test earlier this week, was "in defiance of UN Security Council Resolution 2231" and that the event was part of "Iran's destabilizing behavior all across the Middle East". "The Trump administration strongly condemns such actions, which place American lives at risk".
Iran has test-fired several ballistic missiles since the nuclear deal in 2015, but this is the first during Trump's administration.
Mr Flynn did not accuse Tehran during the White House daily press briefing of violating that nuclear accord.
Iran yesterday warned the United States against "creating new tensions" over its ballistic missile test as Washington called for urgent talks at the United Nations Security Council on the issue.
It could mean the Trump administration is seeking ways to undo the nuclear deal.More news: Gigi and Bella Hadid March Against President Trump's Immigration Order
A United Nations Security Council Resolution bars Iran from undertaking "any activity related to ballistic missiles capable of delivering nuclear weapons, including launches using ballistic missile technology".
Haley also added that America wanted to shoot down its supplies of missile technology to Tehran, and said that no other country should be supplying Iran with any of the technology which allows such unsafe missile tests.
The Resolution was adopted on July 20, 2015 to endorse a nuclear deal between Iran and six world powers, known as the Joint Comprehensive Plan of Action (JCPOA).
News of the latest test comes as French Foreign Minister Jean-Marc Ayrault arrived in the Iranian capital for a two-day visit.More news: Boat with 28 Chinese tourists missing in Malaysia
Trump administration officials are expected to brief reporters later today to elaborate on Flynn's warning.
Prime Minister Benjamin Netanyahu called it a "flagrant violation" of the Security Council resolution that "must not go unanswered", adding that he will bring up the possibility of reinstating sanctions when he meets with President Trump next month.
The missile was reportedly launched from a test site near the city of Semnan, about 225 kilometers east of Tehran.
Nikki Haley, the U.S. ambassador to the United Nations, said Tuesday after a closed meeting of the UN Security Council that "we're not going to stand by".More news: Five-star defensive tackle Aubrey Solomon chooses MI