Israel says it has successfully tested its mid-range David's Sling anti-missile system, a major step toward completing a planned four-tier defense shield but it's not expected to operational until 2013 at the earliest.

That leaves a potentially dangerous gap in the Jewish state's air defenses, primarily the Iron Dome system, which shot down an estimated 90 percent of the Palestinian rockets it engaged during an 8-day battle that ended when a cease-fire took effect last Wednesday.

Military sources said David's Sling shot down its first missile during Sunday's test, conducted from the Palmachim Air Base south of Tel Aviv where most missile test launches are conducted.

Israel has deployed five batteries of Iron Dome, developed by state-owned Rafael Advanced Defense Systems. Each battery costs $50 million. It needs at least 13 to provide nationwide defenses. Two more are in the works and the Israeli government, using U.S. funds, last week allocated funds for four more.

Iron Dome was designed to counter rockets with a range of 2.5-40 miles. An upgraded variant, the fifth battery capable of engaging at longer range, was rushed into operation during the fighting and its radar-guided Tamir interceptors shot down Iranian-made Fajr-5 missiles aimed at Tel Aviv and Jerusalem from the Hamas-ruled Gaza Strip.

That negated the Palestinians' acquisition of more sophisticated and destructive missiles, which threatened Israel's civilians.

But the Israelis still face a more potent threat from the Iranian-backed Hezbollah in Lebanon. It's reputed to have hundreds of long-range missiles capable of hitting anywhere in Israel that Iron Dome wasn't designed to counter.

David's Sling, under development by Haifa's Rafael and the U.S. Raytheon Co., is designed to intercept and destroy missiles with a range of 25-185 miles. It will constitute the middle layer of Israel's emerging anti-missile shield. Iron Dome constitutes the bottom level.

Israel Aerospace Industries' Arrow-2 anti-ballistic missiles system, with at least two batteries operational and the more advanced Arrow-3, due to be deployed by 2016, provide the top of the defense shield.

State-owned IAI is working with the Boeing Co. of the United States on Arrow-3. It's intended to intercept Iranian ballistic missiles, possibly carrying nuclear warheads, outside Earth's atmosphere.

Rafael officials say they intend that David's Sling will be able to shoot down aircraft. An air-to-air version may also be developed.

"The idea is to take a technology engine and build a wide range of products around it," explained Rafael's marketing and business development director, Yossi Horowitz.

Cuts in defense spending are the driver here.

"We're in an era of a frenzy of cuts in defense budgets," he said.

But even as Israel's strengthens its air defenses, the threat itself is growing.

The Nov. 14-21 Gaza fighting finally brought Israelis face-to-face with the nightmare scenario their military planners have been grappling with for several years. That is hostile neighbors armed with mid-range missiles and rockets, largely provided by Iran and Syria, theoretically at least have the ability to inflict heavy casualties and massive damage on Israel's cities and infrastructure, not to mention strategic targets and military installations.

They can do this without Iran or Syria, whatever's left of it, having to directly engage Israel, although adding ballistic missiles to the equation magnifies the danger immensely.

Arrow 2 and 3 haven't been tested in combat.

Despite Iron Dome's kill rate -- it only engages missiles whose trajectories indicate they will hit populated areas or infrastructure -- the system's only been in operation against relatively small numbers of missiles in the air at the same time and coming from one direction.

By Israeli count, the Palestinians possess around 9,500 rockets, including Fajr-5s. Hamas' power was weakened by some 1,500 Israeli airstrikes on Gaza but it hasn't been broken.

Hamas will be able to replenish its arsenal if the Islamist government in Egypt allows fresh supplies to reach Gaza.

Gen. Mohammad Ali Jafari, commander of Iran's Revolutionary Guards, admitted Nov. 21 that Tehran has provided Hamas with Fajr-5 technology, if not the actual weapons.

If the Palestinians unleash missiles in conjunction with Hezbollah, which reportedly has in excess of 42,000 weapons of various calibers, Israel's defenses, as they stand now and for the next year or so, could be overwhelmed.