President Donald Trump approved military strikes against Iran in retaliation for the shooting down of US surveillance drone, the New York Times reported.

But on a day of escalating tensions, the president backed down from launching them on Thursday night (US time).

The Times reported that as late as 7pm military and diplomatic officials were expecting a strike.

Senior administration officials said the about-face came on a day of intense discussions and debate at the White House among the president's top national security officials and congressional leaders.

Officials said the president had initially approved attacks on a handful of Iranian targets, like radar and missile batteries.

The was operation was reportedly in its early stages when it was called off, a senior administration official said. Planes were in the air and ships were in position, but no missiles had been fired when word came to stand down, the official said.

The reversal put a halt to what would have been the president's third military action against targets in the Middle East.

Trump had struck twice at targets in Syria, in 2017 and 2018.

It was not clear whether Trump changed his mind on the strikes or whether the administration altered course because of logistics or strategy.

It was also not clear whether the attacks might still go forward.