It happened in a remote mountainous area of Romania during a joint exercise with Romanian troops.

A Romanian soldier also died.

Teams of forensic experts and members of the Israel Defence Forces rabbinate flew to the crash scene from Tel Aviv to collect and identify the remains of the IAF servicemen.

The Israelis who died were: Lieut-Colonel (res) Avner Goldman, 48, of Modi'in; Lieut-Colonel Daniel Shipenbauer, 43, of Moshav Kidron; Major Yahel Keshet, 33, of Hatzerim; Major Lior Shai, 28, of Tel-Nof; Lieut Nir Lakrif, 25, of Tel-Nof; and Staff Sergeant Oren Cohen, 24, of Rehovot.

Before the seven bodies were located near the crash site, an 80-member Israeli search-and-rescue unit - including rabbis and dog teams - headed for the Carpathian mountains to look for them.

Israeli prime minister Benjamin Netanyahu said: "It was a great tragedy and this is hard day for the house of Israel."

Romanian defence minister Gabriel Oprea sent condolences to families of those that died and his Israeli counterpart Ehud Barak expressing his "deep regret".

Brigadier General Relik Shafir, a reserve officer with the Israeli air force, said: "It's been a black day for all of us."

He added that two Israeli Sikorsky CH-53 Sea Stallion helicopters had been training in a mountainous area in heavy fog when one of the choppers lost touch with the other and apparently hit the mountain.

In the military exercise, crews were being trained to fly at low altitudes.

Big-Gen Shefer said that two experienced Israeli three-man flight crews and one Romanian liaison officer had been on board.

The IDF had reviewed the radio communications between the two helicopters and did not find any indication of technical difficulties.

Mircea Opris, Romania's chief mountain rescue official, said that the helicopter burst into flames after it hit the mountain.

"It is totally dismembered," he added.

Police spokesman Ciprian Aldea said "It is a very difficult area, very rocky.

"You can't reach the area without the appropriate search equipment."

The Israeli military said the helicopter's black box was found and will shed light on the cause of the accident.

The Israeli air force had sent an Israeli C-130 Hercules aircraft plane to help search for the wreckage.

The joint exercises, which were due to end yesterday, were suspended after the crash. The Romanian and Israeli troops were taking part in the 11-day Blue Sky 2010.

Israel's military has been training with the Romanians since 2004. The Israelis also train with other European militaries and with the US to give their crews experience in unfamiliar terrain.