(Adds Israeli military spokesman, background)

VIENNA, Jan 20 (Reuters) - The U.N.'s nuclear watchdog said on Tuesday it would look into a claim by Vienna-based Arab ambassadors that Israel may have used ammunition containing depleted uranium in Gaza attacks.

The International Atomic Energy Agency said the request was made in a letter addressed to Director General Mohammed ElBaradei and was delivered by the Saudi Arabian ambassador on Monday on behalf of other Arab diplomats.

"We are circulating the letter to member states and will investigate the matter to the extent of our ability," IAEA spokeswoman Melissa Fleming said.

She said the IAEA had not yet decided on its course of action as it needs to check with member states first.

The Israeli ambassador to the IAEA, Israel Michaeli, declined to comment on the letter while a spokesman for the Israeli military said he was checking the report.

The IAEA has in the past contributed to studies on depleted uranium traces from ammunition in the Balkans which found it was highly unlikely that a reported increase in cancer risks there could be linked to the traces.

Depleted uranium is used in weapons because it can penetrate tanks and armour more easily due to its density and other physical properties.

It is a particular health risk as a dust around impact sites where people's lungs and other vital organs can be exposed to it. It also has civilian uses in medical equipment and is used in radiation shields. (Reporting by Sylvia Westall in Vienna, additional reporting by Ari Rabinovitch in Jerusalem)

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