The two leaders met in Caracas on the first leg of a four-nation tour that will also take Ahmadinejad to Nicaragua, Cuba and Ecuador. Their conversation reportedly often focused on anti-U.S. rhetoric, which according to the Daily Mail included Mr Chavez saying that:
"he was hiding a bomb under a grassy knoll before the steps of the presidential palace, saying: 'That hill will open up and a big atomic bomb will come out. The imperialist spokesmen say Ahmadinejad and I are going into the basement now to set our sights on Washington and launch cannons and missiles... It's laughable."
The leaders were apparently serious, however, when discussing the threat they believe the U.S. poses.
"We are very worried," Chavez said of the pressures being put on Iran by the United States and its allies, which he accused of being a threat to peace.
"They present us as aggressors," Chavez said as he received Ahmadinejad at the presidential palace.
"Iran hasn't invaded anyone," he added. "Who has dropped thousands and thousands of bombs ... including atomic bombs?"
Ahmadinejad's visit comes after the U.S. imposed tougher sanctions against Iran over its nuclear program, which Washington believes Tehran is using to develop atomic weapons. Chavez and his allies back Iran in arguing the nuclear program is purely for peaceful purposes.
Both leaders joked that their relationship shouldn't cause any concern.
Ahmadinejad said if they were together building anything like a bomb, "the fuel of that bomb is love."
Chavez played on the same theme in his remarks: "We's going to work a lot for some bombs, for some missiles, to keep the war going. Our war is against poverty, hunger and underdevelopment."
The Venezuelan leader said in his televised speech that Iranians assistance has helped the South American country build 14,000 homes as well as factories that produce food, tractors and vehicles.
"We will always be together," Ahmadinejad said through an interpreter. Smiling as he put his hand on Chavez's arm, the Iranian leader called the Venezuelan president "the champion of fighting against imperialism."
Government officials signed two agreements promoting industrial cooperation and worker training.
Chavez accused the U.S. and its allies of wrongly demonizing Iran.
Iran finds itself under increasing pressure in the standoff over its nuclear program, and in response to the latest U.S. sanctions has threatened to blockade the Strait of Hormuz, an important transit route for oil tanker shipments.
Diplomats on Monday confirmed a report that Iran has begun uranium enrichment at an underground bunker, a development that increases fears among U.S. and European officials about Iran's nuclear ambitions. Two diplomats spoke to The Associated Press on condition of anonymity because their information was confidential and based on an inspection by the International Atomic Energy Agency.
Chavez's long-running confrontation with Washington also looks set to grow more antagonistic after the U.S. State Department announced, just hours before Ahmadinejad's arrival, that it was expelling Venezuela's consul general in Miami, Livia Acosta Noguera, due to allegations that she discussed a possible cyber-attack against the U.S. government.
The expulsion followed an FBI investigation into accusations contained in a documentary aired by the Spanish-language broadcaster Univision last month. According to the documentary, Acosta discussed the possible cyber-attack while she was previously assigned as a diplomat in Mexico. The documentary was based on recordings of conversations with her and other officials, and also alleged that Cuban and Iranian diplomatic missions were involved.
Chavez called the U.S. action "unjustified, arbitrary" and said his government will consider its response. He called it "an attack against our nation."
The diplomat had already returned to Venezuela in December because "we knew that was going to occur," Chavez said.
Beyond voicing criticism of the U.S. on his tour, Ahmadinejad is also likely to look for ways to use his Latin American alliances to diminish the impact of sanctions on Iran's oil industry, said Diego Moya-Ocampos, an analyst with consulting firm IHS Global Insight in London.
However, Moya-Ocampos predicted that "Venezuela is going to be very careful not to push its relationship with Iran beyond the U.S. tolerance limits," so as not to risk being hit with more U.S. sanctions. Last year, the U.S. imposed sanctions on state oil company Petroleos de Venezuela SA for delivering at least two cargoes of oil products to Iran.
The U.S. government has also repeatedly accused Iran of sponsoring terrorism, and growing Iranian diplomatic ties with some Latin American countries have generated worries in Washington.
In Quito, Ecuador, Foreign Minister Ricardo Patino told reporters that Ecuador's government "has no reason to stop having relations with Iran" and said his country recognizes Iran's "right to the peaceful use of nuclear energy."
Argentina, which has good relations with Venezuela, also has warrants out for the arrests of Iran's defense minister and other officials suspected of involvement in the 1994 bombing of a Jewish center in Buenos Aires that killed 85 people.
The Simon Wiesenthal Center, a Jewish human rights organization based in Los Angeles, urged Ahmadinejad's hosts to tell Iran that they support Argentina's demands for the extradition of those implicated in the attack. The organization also condemned Ahmadinejad for threatening Israel, saying in a statement on Monday that "honoring that trafficker of hatred with impunity involves his hosts as accomplices."