The U.S. Embassy in Jerusalem early on Sunday lifted its shelter-in-place order for US government employees after the threat from Iranian drones and missiles "diminished."

But the embassy warned that security in Israel "remains complex" and can change quickly.

"The U.S. Embassy in Jerusalem reminds U.S. citizens of the continued need for caution and increased personal security awareness as security incidents often take place without warning," the embassy said in a security alert.

-ABC News' Christopher Boccia and Kevin Shalvey

Secretary of State Antony Blinken condemned Iran's attack on Israel, saying the U.S. doesn't seek escalation but will support Israel's right to defend itself and will protect U.S. personnel in the Middle East.

"The United States condemns Iran's attack on Israel in the strongest terms," Blinken said in a statement.

He added that he'll be "consulting with allies and partners in the region and around the world in the hours and days ahead."

-ABC News' Shannon K. Crawford

Two U.S. officials confirmed that U.S. forces shot down about 70 Iranian drones headed towards Israel.

One official added that one of the U.S. Navy destroyers in the eastern Mediterranean was also able to bring down an undetermined number of Iranian ballistic missiles.

One of the officials said the destroyer shot down three Iranian ballistic missiles.

-ABC News’ Luis Martinez

The Israel Defense Forces Aerial Defense Array successfully intercepted the majority of Iran's surface-to-surface missile launches using the "Arrow" Aerial Defense System, together with Israel's strategic allies, before the launches crossed into Israeli territory.

A small number of hits were identified, including at an IDF base in southern Israel, where minor damage was caused to infrastructure.

Over the past few hours, many dozens of hostile aircraft, as well as dozens of cruise missiles, from Iran were identified approaching Israeli territory and intercepted. Dozens of IAF fighter jets are currently operating to intercept all aerial threats approaching Israeli territory.

According to a situation analysis by IDF’s Home Front Command, the residents of the following towns: Northern Golan, Nevatim, Dimona, Eilat-City, Be'er Sheva and Arad no longer need to stay near a protected space.

The IDF said it is deployed on all fronts, prepared, and continuing to defend Israeli territory.

-ABC News' Will Gretsky

The U.S. is sanctioning two groups and 16 people it says enabled Iran's drone production following Iran's attack on Israel last weekend.

"Today, in coordination with the United Kingdom and in consultation with partners and allies, we are taking swift and decisive action to respond to Iran’s unprecedented attack on Israel," Treasury Secretary Janet Yellen said. "We’re using Treasury’s economic tools to degrade and disrupt key aspects of Iran’s malign activity, including its UAV program and the revenue the regime generates to support its terrorism."

The Treasury Department said it’s sanctioning Khuzestan Steel Company, Iran's largest steel producer. The Treasury Department said Iran's metals sector generates "several billion dollars in revenue annually."

The U.S. is also targeting the Iranian carmaker Bahman Group for its role in making vehicles used by the Islamic Revolutionary Guard Corps for military operations.

The sanctions also target people who work for Iran-based drone manufacturers, including executives of the Mado Company, which the U.S. says produced drone engines used in Iran's Shahed UAVs. The U.S. also sanctioned members of the IRGC who it says help supply proxy groups, like the Houthis in Yemen, with drones that have attacked U.S. service members in the Red Sea.

Yellen added that the U.S. would "continue to deploy" sanctions to counter any further action by Iran, with the goal of making it harder and more expensive for Iran to undertake destabilizing actions.

President Joe Biden said in a statement that these sanctions are "holding Iran accountable."

Biden emphasized that the sanctions are in coordination with the international community, and he said the other G7 countries are committed to increasing "economic pressure" on Iran alongside the U.S.

Biden said he has instructed his team to continue to impose sanctions that will degrade Iran's military capabilities.

Biden also reiterated his ironclad support for Israel, and issued a warning to Iran and those who "enable" Iran's attacks.

"We are committed to the security of our personnel and partners in the region," Biden said. "And we will not hesitate to take all necessary action to hold you accountable."

-ABC News’ Michelle Stoddart and Justin Gomez