Iran's semiofficial Fars news agency identified the commander as Farhad Dabirian and said he was killed in the south Damascus suburb of Sayyida Zeinab. The area is home to a holy shrine for Shiite Muslims.
There was no immediate claim of responsibility for the killing and Fars reported no additional details on how Dabirian was killed.
Iran is an ally of Syria and has offered military advisers and sent militiamen and material support to help President Bashar Assad's government forces in the nine-year civil war.
Fars said Dabirian was a commander of the battle to retake the historic town of Palmyra from the Islamic State group.
The Britain-based Syrian Observatory for Human Rights, an opposition war monitor, also reported that Dabirian was killed Friday night without saying how. It added that the late commander was close to Sayyed Hassan Nasrallah, the leader of Lebanon's Iran-backed Hezbollah group.
In recent years, Israel has repeatedly carried out airstrikes in Syria against targets belonging to Iran and its regional proxies. One airstrike last month killed two members of the Palestinian militant group Islamic Jihad, which is backed by Iran.