Croatia star Ivan Perisic warned his team they would need to improve to overcome Denmark in the last 16 of the World Cup.

Zlatko Dalic's men finished Group D with a perfect record after overcoming Iceland 2-1 on Tuesday.

Perisic scored a fine 90th-minute winner for Croatia after Gylfi Sigurdsson's penalty had cancelled out Milan Badelj's opener.

But the Inter attacker said his team needed to get better to beat Denmark, the team they face in the last 16 on Sunday.

"I watched the first half of Denmark [in the 0-0 draw against France]," Perisic said.

"They're a strong team, we will have to study them closely and be better than [against Iceland] to get past them."

Croatia were just about guaranteed first place in the group before their meeting with Iceland, but nonetheless sealed a third straight win.

Perisic praised his team for their display, while also acknowledging Heimir Hallgrimsson's men.

"It was tough, really tough. We know how they play, with them you need to fight until the last minute, and we did that," he said.

"Before the game, we were 99 per cent in first place, but we showed character and finished the job. With three wins we go further."