Iran's foreign minister ridiculed a security conference speech by Netanyahu, who used a part of a drone to make a point.
"Last week its brazenness reached new heights".
But signatories France, Britain, Germany, Russia and China say the deal can not be revisited and Iran is holding up its end by allowing inspections. The accord's defenders included US Secretary of State John Kerry, who said the world "is not a better place" without it.
Netanyahu renewed his call to "fix or nix" the worldwide deal to curb Iran's nuclear programme, a message that has failed to sway much of the trans-Atlantic security establishment represented in Munich.
Mr Netanyahu said on Sunday: "Through its proxies - Shiite militias in Iraq, the Huthis in Yemen, Hezbollah in Lebanon, Hamas in Gaza - Iran is devouring huge swathes of the Middle East".
Again referring to Zarif, who is scheduled to speak later in Munich, the Israeli leader said: "No doubt Mr Zarif will brazenly deny Iran's involvement in Syria".
Netanyahu also warned that Iran should "not test Israel's resolve".
The arrests came just a few days after the Israeli police said that they had collected enough evidence to support claims that Netanyahu committed fraud and took bribes.
Netanyahu said his government was "stable" and criticized the police investigation against him after detectives recommended his indictment for corruption.
Netanyahu said there were "striking similarities" between the Iran leadership and Nazi Germany, saying that Tehran wants to destroy Israel. "Israel will continue to act to prevent Iran from establishing another terror base from which to threaten Israel", Netanyahu said".
Zarif later mocked Netanyahu's theatrics, calling it a "cartoonish circus".
Former Secretary of State John Kerry, an architect of the nuclear deal with Iran, mounted a defense of it, saying it wasn't ideal but that it bought the global community time to find a permanent solution.
Before addressing the conference, Netanyahu and his wife, Sara, visited a memorial to the 11 Israeli Olympic athletes killed in Munich in 1972. "Millions were slaughtered here just because they were Jews".