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ISTANBUL (Reuters) - Turkey accused Greece on Friday of breaching international law by carrying out a military exercise on an island in the Aegean Sea, in an escalating row between the two NATO allies.

The Turkish foreign ministry said it was aware of Greek media reports that Greek special forces had parachuted onto Kos and said the exercise was a breach of a 1974 treaty that banned all such training on the island.

A Greek defence ministry source confirmed there had been a scheduled exercise at the beginning of the week involving parachutists.

"The training schedule of the Greek armed forces is not going to stop," the source told Reuters.

Turkey warned it could take action if necessary.

"We call on our neighbour Greece to refrain from unilateral actions that ... could trigger tensions and are against international law," foreign ministry spokesman Huseyin Muftuoglu said in a statement.

Tensions between the two countries have been on the rise since a Greek court last week blocked the extradition of eight Turkish soldiers Ankara accuses of involvement in July's failed coup. Turkey has said relations with Greece would be reviewed.

On Wednesday, Greece reported mass incursions by Turkish military aircraft over the central and southern Aegean, which Athens termed "cowboy antics".

Kos is part of the Dodecanese chain of islands, placed under demilitarisation as part of a peace accord after World War Two, when Italy ceded them to Greece.

Greece, which says Turkey was not party to that treaty because of its neutral stance in the war, started to militarize some islands after the Turkish invasion of Cyprus in 1974 triggered by a brief Greek-inspired coup.

Cyprus remains divided between Greek and Turkish Cypriot communities living on either side of a U.N.-monitored ceasefire line. Reunification efforts have intensified in recent months, but a meeting in Geneva in mid-January involving guarantor powers Britain, Greece and Turkey was inconclusive.

Turkey and Greece came to the brink of war in 1996 over the ownership of uninhabited Aegean islets known as Imia in Greek and Kardak in Turkish.

The two countries play an important role in the handling of Europe's worst migration crisis in decades and the EU depends on Ankara to enforce a deal to stem mass migration to Europe.

(Reporting by Humeyra Pamuk and Michele Kambas in Athens; Editing by Nick Tattersall)

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