The relationship between the United States and Iran has taken many turns. The two countries have no formal diplomatic relations since 1980. Both have also been entangled in a political conflict and a longstanding military standoff—with the American government imposing economic sanctions and a trade embargo against Iran and the Iranian government maintaining its proxy war against U.S. allies. The conflict between the two has recently escalated after the U.S. attacked three Iranian nuclear facilities on 22 June 2025 as part of its response to the Iran-Israel Conflict.
The History of Iran-US Relations: From Alliance to Conflict
Early Relations Between the United States and Iran
During the mid-to-late nineteenth century, Iran, which was known in the Western world as Persia, considered the U.S. a more trustworthy foreign power than the perceived self-serving colonial interests of Britain and Russia. The early US-Iran relationship remained positive during and after the Second World War and further until the later years of the government of former Iranian Prime Minister Mohammad Mosaddegh.
It is also interesting to note that the American government assisted in creating the nuclear program of Iran. To be specific, as part of its Atoms for Peace initiative, the U.S. provided Iran its first nuclear reactor and nuclear fuel in 1957. The Americans further provided weapons-grade enriched uranium after 1967. Western European governments also participated in the U.S. initiative. This gave the Iranian government additional assistance.
Mosaddegh was later overthrown by a coup organized by the U.S. Central Intelligence Agency and the British Secret Intelligence Service or MI6. However, the Americans maintained a healthy alliance with the reigning Iranian monarch, Shah Mohammad Reza Pahlavi. But the Iranian Revolution of 1979 that overthrew Pahlavi and saw the end of the Persian monarchy resulted in disagreements that drastically reversed the relationship between the U.S. and Iran.
Iran-US Relations During the Iranian Revolution of 1979
The stance of the American government toward Iran during the Iranian Revolution can be confusing for some. Remember that the U.S. supported the Shah. Because of this, protesters perceived the reigning monarch as a puppet of a non-Muslim Western power, particularly the U.S. They also deemed that Western influence was affecting Iranian culture.
However, the support for the Iranian monarchy was actually diminishing under the administration of U.S. President Kimmy Carter. The pronounced support of the Shah to the series of petroleum price increases made by the Organization of the Petroleum Exporting Countries starting in 1973 did not sit well with Carter and his government.
The Shah was eventually deposed and exiled in Egypt in February 1979. In late October of the same year, he went to the U.S. for cancer treatment. The Iranian government headed by Grand Ayatollah Ruhollah Khomeini and leftists group demand for the American government to return the former monarch to Iran for trial and execution.
On 4 November 1979, a group of young Islamists who called themselves the Muslim Student Followers of the Imam’s Line barged in the U.S. embassy compound in Tehran, seized its facilities, and held 52 diplomats for 444 days. This incident marked the beginning of longstanding tension between the United States and Iran.
U.S. President Jimmy Carter issued Executive Order 12170 ten days after the hostage crisis in Iran had started. It effectively froze about USD 12 billion in Iranian assets held within the U.S. However, the Algiers Accords signed on 19 January 1981 eventually resulted in the release of the hostages and the partial release of the frozen assets.
Escalation of Tensions During the Iran-Iraq War
The relationship between Iran and the U.S. did not improve even after the resolution of the Iran hostage crisis of 1979. Specifically, during the Iran-Iraq War that began on 22 September 1980, the U.S. government under the administration of President Ronald Raegan opted to support Iraq by arming the Iraqi forces, establishing full diplomatic relations with Saddam Hussein, and pursuing economic sanction bills against Iran.
Several pivotal events marked the history of Iran-US relations during the Iran-Iraq War. For example, the U.S. government criticized Iran for supporting the Islamist group Hezbollah, which was allegedly responsible for carrying out anti-American attacks since 1983. These attacks include the bombing of the U.S. Embassy in Beirut in April 1983 and the Beirut barracks bombing in October 1983. Both incidents resulted in American casualties.
There were attempts to repair relations between the two countries. One notable example was the Iran-Contra Affair Scandal that surfaced in 1986. A PBS report explained that senior officials of the Reagan administration facilitated arms sales with Iran despite an embargo. Then National Security Adviser Robert McFarlane explained that the transaction would improve Iran-US relations and increase American influence in the Middle East.
Both Iran and U.S. remained in conflict. In particular, near the end of the Reagan administration, the U.S. launched Operation Praying Mantis on 18 April 1988 that involved a naval combat operation within the Iranian territorial waters in retaliation to the mining of the Persian Gulf. The tension worsened when the U.S. Navy via the guided missile cruiser USS Vincennes shot down Iran Air Flight 655 on 3 July 1988 and killed 260 civilians.
From Goodwill Gesture to the Axis of Evil Branding
The administration of President George H. W. Bush marked another attempt to establish goodwill with Iran. He announced a “goodwill begets goodwill” gesture during his inaugural speech on 20 January 1989. Brent Scowcroft, the national security adviser of the Bush administration, said in 1991 that it was likely to reduce sanctions Iran, take it off from the terrorist list, and extend compensation from the Flight 655 incident.
No positive developments emerged between the two countries under the Bush administration. The situation became more problematic when Bill Clinton took office in 1993 due to the dual containment foreign policy of the U.S. The administration saw an opportunity to contain Iran and Iraq to ensure no single country would become powerful in the Middle East. It placed Iran under a trade embargo in 1995 and actively appealed to European countries and Japan to deny the country access to global capital and arms markets.
Tensions escalated further under the administration of George W. Bush who gave his infamous “Axis of Evil” speech on 29 January 2002 after the September 11 terrorist attacks in 2001. This placed Iran alongside Iraq and North Korea as part of a triad of evil threatening global peace. He said that the proliferation of long-range missiles in these countries constituted terrorism and endangered the U.S. national security. The speech outraged the Iranians.
Concerns over the nuclear program of Iran started to surface in 2003. The U.S. government alleged that Iranians were developing nuclear weapons. However, Iran maintained that its nuclear program centered solely on electricity generation. The Bush administration still imposed sanctions against Iranian institutions beginning in 2006 alongside covert operations aimed at destabilizing the religious leadership in the country.
Modern Developments in the History of Iran-US Relations
There were some positive developments under Barack Obama. Iran, the United Nations, and the European Union signed the Joint Comprehensive Plan of Action or Iran Nuclear Deal. The deal involved the U.S. lifting its sanctions on Iran and the Iranian government agreeing to give up its nuclear program and allow UN workers to conduct regular facility inspections.
However, beginning in the administration of Donald Trump in 2017, numerous events strained Iran-US relations once again. Executive Order No. 13769 signed in January 2017 banned Iranian citizens and others from entering U.S. soil. Trump also slammed the Iranian Nuclear Deal. He pulled out of the deal in May 2018 and reimposed economic sanctions later that year.
Tensions escalated beginning in May 2019 when the U.S. deployed military assets to the Persian Gulf after receiving reports that Iran and its proxy militias were planning to target U.S. forces in the Gulf region and control oil shipping across the Strait of Hormuz. The two countries exchanged threats and counter-threats alongside key events.
Notable events such as the incident over the Gulf of Oman in May and June 2019, the shoot-down of a U.S. drone by Iranian forces in June 2019, and attacks in American bases in Iraq by militias groups allegedly supported by Iran. One of the highlights of the modern history of Iran-US relations under the Trump administration was the assassination of Qasem Soleimani on 3 January 2020.
Soleimani was dubbed as one of the most powerful figures in Iran and the Middle East, He was the commander of the Quds Forces. This unit specializes in unconventional warfare, extraterritorial military, clandestine operations, and intelligence. Iran saw his assassination as an act of “international terrorism” and a direct attack on its sovereignty.
FURTHER READINGS AND REFERENCES
- Ali, A. 2011. “Brigadier General Qassem Suleimani: A Biography.” Middle Eastern Outlooks. 1:2. Available via PDF
- Conry, B. 1994, November 10. America’s Misguided Policy of Dual Containment in the Persian Gulf. Cato Institute. Available via PDF
- Filkins, Dexter. 2013, September 23. “The Shadow Commander.” The New Yorker. Available online
- n.d. “The Iran-Contra Affair.” American Experience. PBS. Available online
- Indyk, M. 2009. Innocent Abroad: An Intimate Account of American Peace Diplomacy in the Middle East. New York: Simon & Schuster
- Simbar, R. 2006. “Iran and the US: Engagement or Confrontation.” Journal of International and Area Studies. 13(1): 73-87. JSTOR: 43107130