Iran says it has started the process to enrich uranium to 20 per cent purity, well beyond the threshold set by its 2015 nuclear deal with major powers, sparking international concern.
The move at its underground Fordow facility was confirmed by UN watchdog the International Atomic Energy Agency (IAEA).
It was the most important suspension yet of Iranian commitments under the landmark deal, a process it started in 2019 in response to US President Donald Trump's dramatic withdrawal from the accord the previous year.
Iranian President Hassan Rouhani speaking during a press conference in Tehran, Iran. Source: AAP
"The process for producing 20 per cent enriched uranium has started at Shahid Alimohammadi enrichment complex (Fordow)," government spokesman Ali Rabiei said in comments quoted by the state broadcaster.
President Hassan Rouhani had ordered the enrichment "in recent days" and "the gas injection process started as of hours ago," he said.
Foreign Minister Javad Zarif tweeted that "we resumed 20 per cent enrichment as legislated by our parliament," adding that the IAEA had been "duly notified".
He stressed that Tehran took the step "after years of non-compliance" by other parties and that "our measures are fully reversible upon FULL compliance by ALL".
The step comes less than three weeks before the end of the presidency of Mr Trump, who has sought to economically punish and diplomatically isolate Iran with a "maximum pressure" campaign, including tough sanctions.
The Iranian government has signalled a readiness to engage with US President-elect Joe Biden, who has expressed willingness to return to diplomacy with Tehran.
Israel warning
The IAEA confirmed that "Iran today began feeding uranium already enriched up to 4.1 per cent U-235 into six centrifuge cascades at the Fordow Fuel Enrichment Plant for further enrichment up to 20 per cent".
Israeli Prime Minister Benjamin Netanyahu reacted angrily and charged it proved Iran is seeking to build an atomic bomb - a claim the Islamic republic has always denied.
"Iran's decision to continue violating its commitments, to raise the enrichment level and advance the industrial ability to enrich uranium underground, cannot be explained in any way except as the continued realisation of its intention to develop a military nuclear programme," Mr Netanyahu said in a statement.
"Israel will not allow Iran to manufacture nuclear weapons."
The European Union said Iran's enrichment programme would be a "considerable departure" from the deal.
Russia's envoy to the IAEA said that Moscow is "not enthusiastic" about Tehran's move but emphasised that "there is nothing to overdramatise".
"The nuclear programme remains fully transparent and verifiable," Mikhail Ulyanov wrote on Twitter. "We should focus on means to restore comprehensive implementation of the nuclear deal."
Bound by law
Iran had on 31 December informed the IAEA that it would begin producing uranium enriched to up to 20 per cent, the level it had before the nuclear deal was reached.
According to the latest IAEA report available, published in November, Tehran was previously enriching uranium to levels greater than the limit provided for in the 2015 Vienna agreement (3.67 per cent) but not exceeding the 4.5 per cent threshold, and still complied with the agency's strict inspection regime.
But there has been turmoil since the assassination in late November of Iranian nuclear physicist Mohsen Fakhrizadeh.
In the aftermath of the attack, blamed on Israel, hardliners in Tehran pledged a response and the conservative-dominated parliament passed a bill "for the lifting of sanctions and protection of the Iranian people's interests".
The bill also called for the production and storage of "at least 120 kilogrammes per year of 20 per cent enriched uranium".
It also mandated the administration to end UN inspections of Iran's nuclear facilities if the remaining parties to the deal - Britain, China, France, Germany and Russia - do not facilitate Iran's oil sales and guarantee the return of the proceeds.
Before the bill became law, Mr Rouhani slammed it as "detrimental to the course of diplomatic activities."
This satellite photo by Maxar Technologies shows construction at Iran's Fordo nuclear facility last month. Source: Maxar Technologies
But the Guardian council, which arbitrates disputes between the parliament and the government, approved it last month.
Iranian officials, including Mr Zarif, said the government would comply with the parliament's decision.
Quoted by the government's website, Mr Rabiei said that the administration's stance towards the law is clear, "but the government considers itself bound to carry out the law".
