Arab Muslim armies began their conquest of the Persian Sassanian Empire in ad 636 and during the next five years conquered all of Iran, with the exception of the Elburz Mountains and the Caspian coastal plain. They finally put an end to the Sassanid dynasty in 651. For the next two centuries, most of Iran (which at that time extended beyond Herāt in what now is western Afghanistan) remained part of the Arab Islamic empire. The caliphs (successive Islamic leaders) ruled initially from Medina in present-day Saudi Arabia, then from Damascus, Syria, and finally from Baghdād, Iraq, as each city became the seat of the caliphate. Beginning in the late 9th century, however, independent kingdoms arose in eastern Iran; by the mid-11th century, the Arab caliph in Baghdād had lost effective control of virtually all of Iran, although most of the local dynasties continued to recognize his religious authority.

From the time of Islamic conquest, Iranians gradually converted to Islam. Most had previously followed Zoroastrianism, the official state religion under the Sassanid dynasty, but minority groups had practiced Christianity or Judaism. By the 10th century the majority of Iranians probably were Muslims. Most Iranian Muslims adhered to orthodox Sunni Islam, although some followed various sects of Shia Islam. The Ismailis, a Shia sect, maintained a small but effectively independent state in the Rūdbār region of the Elburz Mountains from the 11th through the 13th century. Iran's unique identity as a bastion of Jafari, or Twelver, Shia Islam (which constitutes the main body of Shia Islam today) did not develop until the 16th century.

<top>

In the 11th century Turkic tribes began migrating to Iran, settling primarily in the northwest. The Seljuk Turks (see Seljuks), who had converted to Sunni Islam in the 10th century, defeated local rulers and established dynasties that ruled over most of the country until the Mongol invasions in the 13th century. Mongol rule proved disastrous for Iran. The Mongols destroyed major cities such as Ardabīl, Hamadān, Marāgheh, Neyshābūr, and Qazvīn, and they killed almost all of the inhabitants as punishment for resistance. Ray and Tus, the largest and most important cities in Iran, were destroyed by the Mongols and never rebuilt. The Mongols devastated many regions, especially Khorāsān and Māzandarān, by destroying irrigation networks and cropland. The harsh rule of the Mongols contributed to a continuing economic decline throughout the 13th century.

Prior to 1295 Iran's Mongol rulers, followers of shamanism or Buddhism, did not accept the Islamic faith. Their official indifference or open hostility toward Islam stimulated the transformation of Sufi brotherhoods into religious paramilitary organizations. Although nominally Sunni, many of these brotherhoods became increasingly tolerant of Shia ideas, even incorporating these ideas into their own belief systems. In 1295 Mongol ruler Ghazan Khan, himself a convert to Islam, restored Islam as the state religion, further bolstering the growth of new Islamic ideas.

Ghazan and his immediate successors also adopted policies that reversed Iran's economic decline. In the late 13th and early 14th centuries, cities that had escaped the destruction of the Mongol invasions, such as Eşfahān, Shīrāz, and Tabrīz, emerged as new centers of cultural development. However, from 1335 to 1380 civil strife weakened central authority. Between 1381 and 1405 invasions by Turkic conqueror Tamerlane destroyed more of Iran’s cities and undid most of the progress Ghazan had achieved.

<top>

During the 15th century several competing families and tribes, mostly of Turkic origins, ruled over various parts of Iran. Notable among them were the Safavids, who headed a militant Sufi order founded in the northwest by Shaikh Safi of Ardabīl in the early 14th century. His descendant, Ismail I, conquered first Tabrīz and then the rest of Iran. In 1501 he proclaimed himself shah (king), a title commonly used by Iranian rulers in pre-Islamic times. This marked the beginning of the Safavid dynasty and was the first time since the 7th century that all of Iran was unified as an independent state. Ismail embraced Jafari Shia Islam, established it as the state religion, and began to convert the largely Sunni population to this Shia sect.

Ismail used the new religion to mobilize armies against the Ottomans—Sunni Muslims who controlled a vast empire to the west

. Intermittent warfare between the Safavids and the Ottoman Empire continued for more than 150 years as successive rulers of each accused one another of heretical beliefs. Although this lengthy conflict helped shape Iran's identity as a Shia country, the real conflict between the Safavids and the Ottomans was over territory, especially the Zagros Mountains region and the fertile plains of present-day Iraq. In 1509 Ismail gained control of the Iraqi territory, but it fell into Ottoman hands when Ottoman ruler Süleyman I conquered Baghdād in 1534.

After several unsuccessful campaigns, the Safavids finally recaptured Baghdād in 1623 under Abbas I. (They held the city for 15 years before the Ottomans gained permanent control in 1638.) During his reign, Abbas moved the Safavid capital from Tabrīz, which was dangerously close to the Ottoman border and had been occupied briefly by the Ottomans, to the centrally located city of Eşfahān. He embellished Eşfahān with many bridges, mosques, palaces, and schools. Most of these structures still stand, and they are among the best-preserved examples of Islamic architecture in the world. Abbas also encouraged trade with Europe, especially England and The Netherlands, whose merchants bought Iranian carpets, silk, and textiles.

The Safavid empire gradually declined after the reign of Abbas II ended in 1666. To finance lavish personal lifestyles, later shahs imposed heavy taxes that discouraged investment and encouraged corruption among officials. Shah Sultan Hosain, who ruled from 1694 to 1722, tried to convert forcibly his Afghan subjects in eastern Iran from Sunni to Shia Islam. In response, an Afghan army under Mir Mahmud rebelled, marching across eastern Iran and capturing the Safavid capital of Eşfahān. After a brief siege of the city, the Afghan army executed the shah in 1722, thus ending Safavid rule of Iran. The sudden dissolution of the empire plunged Iran into a 70-year period of relative turmoil, marked by internal civil strife and efforts by Ottoman and Russian forces to occupy border zones. Military leader Nadir Shah, based in Mashhad, succeeded in freeing Iran from foreign occupation in the 1730s and soon extended his rule eastward, but his empire collapsed upon his assassination in 1747. Karim Khan Zand, based in Shīrāz, established a brief period of tranquility in the mid-1700s but was not able to extend his control over all of Iran.

<top>
 

In 1794 Agha Mohammad Khan defeated numerous rivals and brought all of Iran under his rule, establishing the Qajar dynasty. The Qajars were a Turkic tribe that held ancestral lands in present-day Azerbaijan, which then was part of Iran. Agha Mohammad established his capital at Tehrān, a village near the ruins of the ancient city of Ray (now Shahr-e Rey). Agha Mohammad’s nephew and successor, Fath Ali Shah, ruled from 1797 to 1834. Under Fath Ali Shah, Iran went to war against Russia, which was expanding from the north into the Caucasus Mountains, an area of historic Iranian interest and influence. Iran suffered major military defeats during the war. Under the terms of the Treaty of Gulistan in 1813, Iran recognized Russia's annexation of Georgia and ceded to Russia most of the north Caucasus region. A second war with Russia in the 1820s ended even more disastrously for Iran, which in 1828 was forced to sign the Treaty of Turkmanchai acknowledging Russian sovereignty over the entire area north of the Aras River (territory comprising present-day Armenia and Azerbaijan).

During the reign of Mohammad Shah, from 1834 to 1848, Russia began expanding its political influence into Iran. Another world power, Britain, also took interest in the region in order to protect its growing empire in India. Because of Iran’s strategic location between the southern borders of Russia and the westernmost borders of British India, both Britain and Russia regarded an independent Iran as a convenient buffer area between the two empires. At the same time, both powers preferred Iran to have a weak central government so that they could more easily influence the country's internal affairs.

Foreign interference and territorial encroachment increased under the rule of Nasir al-Din Shah (1848-1896) and his son, Muzaffar al-Din Shah (1896-1906). Both men contracted huge foreign loans to finance expensive personal trips to Europe. Neither ruler was able to prevent Britain and Russia from encroaching into regions of traditional Iranian influence. In 1856 Britain prevented Iran from reasserting control over Herāt, which had been part of Iran in Safavid times but had been under non-Iranian rule since the mid-18th century. Britain supported the city's incorporation into Afghanistan, a country Britain helped create in order to extend eastward the buffer between its Indian territories and Russia's expanding empire. Britain also extended its control to other areas of the Persian Gulf during the 19th century. Meanwhile, by 1881 Russia had completed its conquest of present-day Turkmenistan and Uzbekistan, bringing Russia’s frontier to Iran's northeastern borders and severing historic Iranian ties to the cities of Bukhoro (Bukhara) and Samarqand. Several trade concessions by the Iranian government put economic affairs largely under British control. By the late 19th century, many Iranians believed that their rulers were beholden to foreign interests.

<top>

During the early 1900s the idea gradually spread among Iranians that the only effective way to save the country from government corruption and foreign manipulation was to make the shah accountable to a written code of laws. By 1905 this sentiment had grown into a popular movement, the Constitutional Revolution. Following a year of demonstrations and strikes, Muzaffar al-Din Shah was forced to agree to the creation of an elected parliament (the Majlis) and a constitution that limited royal power, established a parliamentary system of government, and outlined the powers of the legislature.

Britain and Russia, apparently fearing that a strong Iranian government might act too independently and threaten their interests in the region, agreed in 1907 to divide Iran into spheres in which each would exercise exclusive influence. Russia then encouraged Mohammad Ali Shah, Muzaffar’s successor who resented the constitutional limits on his authority, to dissolve the Majlis. In 1908 the shah attempted a coup against the elected government, bombing the Majlis building and dissolving the assembly. After a year of fighting between supporters of the constitution and forces loyal to the shah, the constitutionalists prevailed and deposed Mohammad Ali, who fled to Russia. His young son Ahmad Shah, vowing to respect the constitution, was installed under a regent.

The restoration of the Majlis and constitutional government failed to end foreign influence in Iran. In 1901 a British subject had been granted an exclusive 60-year concession to explore Iran for oil. Commercially valuable quantities of oil were discovered in southwestern Iran in 1908, and exports began in 1911. In 1914 the British government purchased 51 percent of the Anglo-Persian Oil Company (formed in 1909; renamed the Anglo-Iranian Oil Company, or AIOC, in 1935), and from then on behaved increasingly like a sovereign power in southwestern Iran. Meanwhile, in 1910 Russia assisted Mohammad Ali Shah in an invasion of Iran and an unsuccessful attempt to overthrow the government. The following year, Russia occupied Tabrīz and forced the Majlis to dismiss American financial advisor William Morgan Shuster, whom the Majlis had invited to Iran to reorganize the national finances; Shuster’s reforms strengthened Iran but threatened Russian and British interests.

<top>

During World War I (1914-1918), Britain and Russia, who were allies, launched attacks from Iran against the Ottoman Empire, which was allied with Germany. Although Iran proclaimed neutrality in the war, several battles were fought in western Iran between Russian and Ottoman forces. These battles destroyed many villages, killed several hundred Iranian civilians, and caused near-famine conditions that probably caused the death of several thousand more. The inability of the Iranian government to protect the country provoked rebellions and autonomy movements in northern Iran between 1915 and 1921.

Meanwhile, in 1919 Britain induced the Iranian prime minister to sign a treaty giving Britain substantial political, economic, and military control over Iran. This agreement would have made Iran a virtual protectorate of Britain, and it aroused the anger of Iranian nationalists. Opposition to the treaty in newspapers and popular demonstrations dissuaded successive governments from submitting it to the Majlis for ratification. By 1921 both Britain and Iran had let the draft treaty quietly die.

<top>

The continuing political strife in Iran alarmed many nationalists, including Reza Khan (later Reza Shah Pahlavi), an officer in Iran’s only military force, the Cossack Brigade. Joining a newspaper publisher known for his admiration of British politicat institutions, Reza Khan used his troops in 1921 to support a coup against the government. Within four years he had established himself as the most powerful person in the country by suppressing rebellions and establishing order. In 1925 a specially convened assembly deposed Ahmad Shah, the last ruler of the Qajar dynasty, and named Reza Khan, who earlier had adopted the surname Pahlavi, as the new shah.

Reza Shah had ambitious plans for what he called the modernization of Iran. These included developing large-scale industries, implementing major infrastructure projects, building a cross-country railroad system, establishing a national public education system, reforming the judiciary, and improving health care. He believed only a strong, centralized government managed by educated personnel could carry out his plans. He sent hundreds of Iranians, including his own son, to Europe for training. Between 1925 and 1941 Reza Shah’s numerous development projects transformed Iran. Industrialization, urbanization, and public education progressed rapidly, and new social classes—a professional middle class and an industrial working class—emerged. However, by the mid-1930s Reza Shah's dictatorial style of rule, including the harsh and arbitrary treatment of his opponents and restrictions on the press, caused increasing dissatisfaction in Iran.

Throughout his reign, Reza Shah tried to avoid involvement with Britain and the Union of Soviet Socialist Republics (USSR; formed from the Russian Empire in 1922). Although many of his development projects required foreign technical expertise, he tried to avoid awarding contracts to British and Soviet companies, believing—as did most Iranians—that this would open the way for their governments to exercise influence in Iran. Although Britain, through its ownership of the Anglo-Iranian Oil Company, controlled all of Iran's oil resources, Reza Shah preferred to obtain technical assistance from France, Germany, Italy, and other European countries. This created problems for Iran after 1939, when Britain and Germany became enemies in World War II. Although Reza Shah proclaimed Iran's neutrality, Britain insisted that the German engineers and technicians in Iran were spies with missions to sabotage British oil facilities in southwestern Iran. Britain demanded that Iran expel all German citizens, but Reza Shah refused, claiming this would adversely impact his development projects.

<top>

Following Germany's invasion of the USSR in June 1941, Britain and the Soviet Union became allies. Both turned their attention to Iran. In addition to their suspicions about the role of German technicians in Iran, Britain and the USSR saw the newly opened Trans-Iranian Railroad as an attractive route for transporting supplies from the Persian Gulf to the Soviet Caucasus region. However, Iran's neutrality ruled out this option. In August 1941, after Reza Shah again refused to expel all German nationals, Britain and the USSR invaded Iran. They swiftly defeated the Iranian army, arrested Reza Shah and sent him into exile, and took control of Iran's communications and coveted railroad. In 1942 the United States, an ally of Britain and the USSR during the war, sent a military force to Iran to help maintain and operate sections of the railroad.

The British and Soviet authorities allowed Reza Shah's system of political and press repression to collapse and constitutional government to evolve with minimal interference. They permitted Reza Shah's son, Mohammad Reza Shah Pahlavi, to succeed to the throne after he promised to reign as a constitutional monarch. In January 1942 the two occupying powers signed an agreement with Iran to respect Iran's independence and to withdraw their troops from the country within six months of the war’s end. A U.S.-sponsored agreement at the 1943 Tehrān Conference reaffirmed this commitment. In late 1945, however, the USSR refused to announce a timetable for its withdrawal from Iran's northwestern provinces of East Azerbaijan and West Azerbaijan, where Soviet-supported autonomy movements had developed. Although the USSR withdrew its troops in May 1946, tensions continued for several months. The dispute, which became known as the Azerbaijan crisis, was the first case to be brought before the Security Council of the United Nations. This episode is considered one of the precipitating events of the emerging Cold War, the postwar rivalry between the United States and its allies and the USSR and its allies.

Meanwhile, Iran's political system became increasingly open. Political parties soon developed, and the 1944 Majlis elections were the first genuinely competitive elections in more than 20 years. Reformist parties were determined to prevent a return to authoritarian rule by the monarchy, while parties opposed to economic and social reforms tended to ally themselves with the shah. Foreign intervention remained a sensitive issue for all parties. Reformists accused conservative politicians of collaborating with foreigners to preserve their privileges. With foreign troops withdrawn and the Azerbaijan crisis resolved, British control of Iran's oil fields became the central issue regarding foreign intervention. The Anglo-Iranian Oil Company (AIOC), which was owned by the British government, continued to produce and market all Iranian oil under the terms of the 1901 concession. The AIOC provided a modest royalty payment, which was only a fraction of its annual profits, to the government of Iran. As early as the 1930s, some Iranians began advocating the nationalization of the country's oil fields; after 1946, this effort developed into a major popular movement.

<top>

In the mid-1940s Mohammad Mosaddeq, an Iranian statesman and a member of the Majlis, emerged as the leader of the oil nationalization movement. This movement sought to transfer control over the oil industry from foreign-run companies to the Iranian government. Throughout his political career, Mosaddeq consistently advocated three goals: to free Iran of foreign intervention, to ensure that the shah remained a democratic monarch and not a dictator, and to implement social reforms. He believed ending foreign interference was a prerequisite for success in other areas, and he was convinced that as long as the AIOC controlled Iran's most important natural resource, foreign influence was inevitable. Beginning in 1945 he led a successful campaign to deny the Soviet Union an oil concession in northern Iran. Although he resisted joining political parties, Mosaddeq agreed in 1949 to head the National Front, a coalition of several parties that supported oil nationalization. Within a year the National Front had members in cities and towns throughout the country and had become adept at organizing mass political rallies.

Conservative political groups, backed by the shah, opposed nationalizing the AIOC, partly because they believed such a course would cause irreparable harm to relations with Britain and partly because they distrusted Mosaddeq's populism. However, as the nationalization movement grew, fewer and fewer politicians openly challenged Mosaddeq on the oil issue. In an effort to forestall nationalization, the shah appointed military officer Ali Razmara as prime minister in 1950. This move increased the scale of demonstrations in favor of nationalization and against a government that increasingly was denounced as a puppet of foreign interests. Razmara was assassinated in 1951 after only a few months in office, and the more militant supporters of nationalization applauded his death. Sensing the popular mood, the Majlis passed a bill nationalizing the AIOC, then took the unprecedented step of appointing Mosaddeq prime minister over the shah's objections.

In response to these events, Britain enforced a blockade on oil exports from Iran, a move that deprived Iran of foreign exchange. Although Iran had not relied on oil revenues prior to 1951, Mosaddeq's development budget anticipated this income; its absence severely hindered efforts to stimulate the economy and implement social reforms. Attempts to secure foreign financial assistance proved unsuccessful because most countries and international financial institutions feared offending Britain. The escalating crisis also discouraged private investment inside Iran. Mosaddeq, like many other Iranian political leaders, hoped the United States would intervene to resolve the crisis. Initially, the United States tried to mediate a compromise. By 1952 it had persuaded Britain to accept the principle of oil nationalization. However, the various diplomatic efforts ultimately failed to resolve the dispute.

In early 1953, when a new administration came to power in the United States, U.S. policy toward Iran began to change. The United States now became sympathetic to British arguments that Mosaddeq's government was causing instability that could be exploited by the USSR to expand its regional influence. As the Cold War escalated, world superpowers began to interpret political developments around the globe as "wins" or "losses" for the U.S.-led Western bloc and the Soviet-led Eastern bloc. Although Mosaddeq advocated Iranian neutrality in the Cold War conflict, neither side wanted to "lose" Iran. Consequently, the United States decided to use its Central Intelligence Agency (CIA) to help overthrow Mosaddeq. By this time, many conservative politicians in Iran, some senior military officers, and the shah were prepared to work with the CIA to bring down the Mosaddeq government. The coup, carried out in August 1953, failed initially, and the shah was forced to flee the country. After several days of street fighting in Tehrān, however, army officers loyal to the shah gained the upper hand. Mosaddeq was arrested, and the shah returned in triumph.

The Iranian government restored relations with Britain in 1953 and concluded a new oil agreement the following year. Under the new agreement, the concession formerly held by the AIOC passed to a consortium of British, Dutch, French, and U.S. oil companies; this consortium was to share the profits of oil operations in Iran with the Iranian government. Although the agreement increased Iran’s share of the oil profits, production levels and sale price remained under foreign control.

<top>

Although he had succeeded his father as shah in 1941, prior to 1953 Mohammad Reza Shah Pahlavi had been overshadowed by Mosaddeq and other politicians and seemed destined to remain a passive, constitutional monarch. Following the coup, however, he moved to consolidate power in his own hands. With the help of the military and later a secret police, the Savak, the shah created a centralized, authoritarian regime. He suppressed opposition by former National Front supporters and Communists, tightly controlled legislative elections, and appointed a succession of prime ministers loyal to him. In 1961 the shah dissolved the Majlis, instructing the prime minister to rule by decree until new elections were held.

Initially, Mohammad Reza Shah Pahlavi did not demonstrate the same enthusiasm for development and reform programs that his father had shown. His early reforms were undertaken only with prodding from the United States, which believed that dissatisfied Iranian peasants were susceptible to influence by local agents of the USSR. In the early 1960s more than 60 percent of Iran’s inhabitants were sharecroppers who received a subsistence share (usually 20 percent) of the harvest from their landlords. A land reform program implemented between 1962 and 1971 required landlords to sell most of their land to the government, which then resold it to the peasants. Although widely promoted as a major rural reform effort, only half of the peasants obtained any land under the program, and about three-quarters of those receiving land got less than 6 hectares (15 acres).

Mohammad Reza Shah took more interest in industrial and public works projects, and between 1963 and 1978 numerous development schemes contributed to an increase in industrialization and urbanization. The shah presented his program as an integral part of a wider reform effort known as the White Revolution, initiated to prevent a Red, or Communist, revolution from originating at the grass roots level. The middle class expanded, but much of the urban growth resulted from the migration of poor villagers seeking city jobs. Consequently, slums proliferated on the outskirts of cities. Government policy focused on the creation of modern industrial facilities but neglected the development of social services. The construction activity under the White Revolution stimulated expectations of political and social change. Oil revenues tripled after 1973 due to higher prices and increased sales, providing ready funding for the shah’s programs. However, economic success only caused the shah’s regime to become more repressive as his confidence in his rule grew.

<top>

Because of his collaboration with the CIA to overthrow Mosaddeq in 1953, the shah was never able to overcome a popular perception that he was merely a tool for foreign interests. Mosaddeq’s ouster had shocked the nation, and over the years his image as a national hero had grown stronger despite the fact that the shah’s government had banned any publications that mentioned his name. Furthermore, because of the CIA’s role in the overthrow, most Iranians saw the United States, even more so than Britain or the USSR, as a threat to Iran's national interests. Strong relations between the United States and Iran at the official level, especially an alliance whereby the United States assisted in the buildup of Iran's military, fed the public’s fears. In the early 1960s the shah's government drafted legislation granting diplomatic status to U.S. military personnel stationed in Iran. Nationalists denounced the bill as a reversion to the detested extraterritorial legal privileges accorded to British and Russian citizens in Iran before 1925.

One of the shah’s most vocal opponents was the leading Shia scholar, or ayatollah, Ruhollah Khomeini. Khomeini was arrested in 1962 after publicly speaking out against the bill, and his arrest instantly elevated him to the status of national hero. Although released the following year, he refused to keep silent. He instead broadened his criticisms of the regime to include corruption, violations of the constitution, and rigging of elections. Khomeini’s second arrest in June 1963 led to three days of rioting in many Iranian cities; the military suppressed the riots only after more than 600 people had been killed and more than 2,000 injured. Fearing that Khomeini would assume martyr status if he were kept in prison or executed for treason, the shah exiled him to Turkey in 1964. Khomeini eventually settled in the Shia theological center of An Najaf in Iraq. From there he maintained regular contact with his former students in the Iranian city of Qum. These students formed the nucleus of a covert anti-shah movement that was growing among the clergy. In 1971 Khomeini published a book, Velayat-e faqih, that provided the religious justification for an Islamic government in Iran.

The shah also failed to win mass support among the secular middle class of professionals, bureaucrats, teachers, and intellectuals. This social group, created as a result of his father’s reforms and expanded during the 1960s and 1970s due to the shah’s own development plans, tended to be highly nationalistic and looked back nostalgically to the Mosaddeq period as an era of genuine democracy. Like the clergy and the religiously inclined traditional middle class of merchants and artisans, the secular middle class resented the lack of meaningful political participation and the close ties the shah had established with the United States. They criticized the shah's promotion of Iran beginning in the late 1960s as America’s security pillar in the Persian Gulf region. Despite their commonality of views, the secular and religious groups had distrusted one another in the 1950s and 1960s. The growing severity of political repression during the 1970s gradually brought them closer together, however, and by 1977 various secular and religious opposition movements were prepared to cooperate against the shah's regime.

<top>

The spark that ignited the revolution was a pro-Khomeini demonstration in Qum in January 1978. Police intervened, the demonstration turned into a riot, and about 70 people were killed before calm was restored. From his exile in Iraq, Khomeini called upon his followers to commemorate the victims on the 40th day after their deaths, in accordance with Iranian mourning customs. In February they held services at mosques throughout the country, and demonstrations in Tabrīz turned into riots during which more people were killed. Thus began a cycle of nationwide mourning services every 40 days, some of which turned violent and resulted in more fatalities. By late summer, when it became clear that the government was losing control of the streets, the shah imposed martial law on Tehrān and 11 other cities. This move only escalated tensions. Employees in different industries and offices began striking to protest martial law, and within six weeks a general strike had paralyzed the economy, including the vital oil sector.

By October the strikes and demonstrations were becoming a unified revolutionary movement. From the security of his exile in Iraq, Khomeini continued to denounce the corruption and injustices of the shah's regime, as well as its dependence on the United States. His sermons were recorded, duplicated on thousands of cassette tapes, and smuggled into Iran. The tapes appealed equally to religious Iranians and members of the secular middle class. Alarmed by Khomeini’s growing influence, the shah persuaded the Iraqi government to expel him. Khomeini immediately found asylum in France, where access to the international media made it even easier for him to communicate with supporters in Iran. In November the shah realized that the army could not indefinitely contain the mass movement, and he began making plans for his departure from Iran. He left the country in mid-January 1979. Two weeks later, Khomeini returned to Iran in triumph after more than 14 years in exile. On February 11, 1979, the royalist government was overthrown, and in a referendum on April 1 Iranians voted overwhelmingly to establish an Islamic republic.

<top>

In February 1979 Khomeini asked Mehdi Bazargan to form a provisional government. By spring the national solidarity that had been so crucial to the ultimate success of the revolution had begun to erode as various political groups competed for power and influence. The secular parties had no leader of comparable stature to Khomeini and soon were marginalized. Of the many religious groups, the most influential was the Islamic Republican Party (IRP), formed by former students of Khomeini. Its principle opponents were two nonclerical religious parties, the moderate Liberation Movement of Iran, to which Bazargan belonged, and the Mojahedin-e Khalq (MK), which espoused radical programs for the redistribution of wealth and tended to be anticlerical.

Bazargan resigned in November 1979 in protest over the hostage crisis (for more information, see the Hostage Crisis and the Iran-Iraq War section of this article)

. In December voters approved a new constitution. Khomeini, as faqih, or supreme spiritual leader, held the highest authority in the country. In January 1980 voters elected Abolhassan Bani-Sadr as the first president of the republic. Following parliamentary elections in March, the Majlis and Bani-Sadr could not agree on a presidential nominee for prime minister. In August Bani-Sadr reluctantly accepted the IRP candidate, Mohammad Ali Rajai, as prime minister. The president and prime minister clashed often, and in June 1981 the Majlis dismissed Bani-Sadr. Rajai subsequently was elected president and chose IRP head Mohammad-Javad Bahonar as his prime minister.

In June 1981 the MK, which had clashed frequently with the IRP throughout 1980, launched an armed uprising against the IRP-dominated government. The MK succeeded in killing more than 70 top IRP leaders by bombing the party headquarters in late June. Two months later the MK assassinated both Rajai and Bahonar. By mid-1982 the government had suppressed the party through severe measures that included mass arrests and summary executions of more than 7,000 suspected MK members. In 1983 the government dissolved the communist Tudeh Party, leaving the Liberation Movement of Iran as the only officially recognized party in opposition to the IRP. As internal political stability returned, distinct ideological factions emerged within the IRP. These internal rifts eventually would cause the IRP to dissolve itself in 1987. Meanwhile, elections in October 1981 brought Seyed Ali Khamenei, one of the founders of the IRP and a member of the Majlis, to power as president.

<top>

Foreign relations played at least as large a role as internal politics in shaping the new republic. The movement against the shah had also been a movement against U.S. involvement in Iran. From the outset the provisional government announced that Iran would no longer serve American interests in the Persian Gulf and would discontinue all military agreements with the United States. However, Khomeini and most government ministers feared that the United States would intervene again, as it had in 1953, to restore the shah to power. After the shah was allowed entry into the United States in October 1979, a group of Iranian students stormed the U.S. embassy in Tehrān and took 66 Americans hostage. The United States responded by freezing Iranian assets held by U.S. banks and imposing trade sanctions against Iran. Thirteen hostages were soon released, but the students announced that the remaining 53 would be released only when the United States apologized for its support of the shah and sent him back to Iran to stand trial for his crimes. They also demanded the return of billions of dollars they believed the shah had hoarded abroad. When Khomeini endorsed the students' actions, the hostage crisis ensued. After nearly 15 months, a settlement mediated by Algeria enabled the hostages to return to the United States, which agreed to participate in a tribunal based in The Hague, The Netherlands, to settle claims of U.S. citizens and companies against Iran. The crisis resulted in a complete severing of the once close relationship between the Iranian and U.S. governments and a deep mutual suspicion of each other's international behavior.

In September 1980, in the midst of the hostage crisis, Iraq launched a surprise invasion of Iran. Iraq wanted to prevent the new Iranian republic from inciting Iraqi Shias to rise up against the secular Iraqi regime (see Iran-Iraq War). The war, which continued until August 1988 when both states accepted the terms of a UN-mediated cease-fire agreement, took a toll on Iran. More than 170,000 Iranians were killed, up to 700,000 were injured, 18,000 men were still listed as missing in action eight years after the cease-fire, and nearly 2.5 million civilians fled from the main battle areas in the western part of the country. Industrial plants, businesses, homes, public buildings, and infrastructure suffered cumulative damages in excess of $30 billion. The cities of Ābādān and Khorramshahr, as well as several towns and hundreds of villages, were virtually destroyed. Vital oil production and export facilities sustained heavy and repeated damage. At the same time, the war created a sense of national solidarity that helped the new government consolidate power, and it stimulated the growth of numerous small industries producing goods for the war effort. During the war, Iran gave refuge to more than 200,000 Iraqi nationals who fled from their own government and absorbed more than a million Afghan refugees who fled following the 1979 Soviet invasion of Afghanistan.

<top>

Since the end of hostilities with Iraq, the government of Iran has focused on reconstruction. It implemented two five-year plans (1989-1994 and 1995-2000), both designed to rebuild the war-devastated regions in the west and to develop major infrastructure projects such as dams, electric power plants, hospitals, highways, port facilities, railroads, and schools. Since 1989 there has been intense political controversy over the government's role in economic development. In general, politicians who favor a strong government role in national economic planning have controlled the executive branch. The Majlis often has opposed such government policies, either out of a conviction that the plans ignored the lower classes or out of a desire to promote the interests of private business.

The death of Khomeini in 1989 may have contributed to the competition among the political elite. During the initial ten years of the Islamic republic, Khomeini did not involve himself in routine governmental affairs but rather served as an arbiter who suggested compromises when the executive and legislative branches could not agree. Because of his charisma and authority as leader of the revolution, politicians always deferred to his suggestions. In the absence of a political figure of comparable stature, political debates became more protracted, and compromises were more difficult to achieve.

The Assembly of Experts chose Khamenei, who would complete his second term as president that year, to succeed Khomeini as faqih. Ali Akbar Hashemi Rafsanjani, who had been speaker of the Majlis from 1980 to 1989, won the 1989 presidential election and was reelected in 1993. As president, Rafsanjani supported the "alternative thought" movement, which advocated official tolerance of more diverse cultural and political views, especially in the press. Mohammed Khatami, who served as minister of Islamic guidance and culture under both Khamenei and Rafsanjani beginning in 1982, crafted this policy. In 1992, after a more conservative Majlis was elected, Khatami resigned, but he continued to serve as cultural advisor to President Rafsanjani. Khatami's opposition to censorship and arbitrary government had wide popular appeal that helped him win almost 70 percent of the vote in the 1997 presidential election. As president, Khatami continued to advocate political reform and freedom of the press as essential for the creation of a civil society. Khatami’s liberal policies have met with opposition from conservatives who distrust popular government. The intense political competition between liberals and conservatives has been reflected in the press and in street demonstrations. In 1998 two liberal politicians and three liberal writers were killed in separate incidents that the Khatami government blamed on conservatives in the Ministry of Information.

In February 2000 Iranian voters favored proreform candidates in elections to the Majlis. The elections appeared to provide a popular mandate for Khatami’s reform efforts, although sweeping changes were not expected.

In the 1990s Iran also sought to improve its foreign relations. The protracted hostage crisis with the United States had brought international disfavor upon the Islamic republic. As a result, it had received little international support when Iraq invaded in 1980 or during the long years of war. Furthermore, in 1989 Khomeini issued a fatwa that absolved of sin anyone who killed British novelist Salman Rushdie, whose book The Satanic Verses (1988) many Muslims considered offensive to Islam. The fatwa, which Rafsanjani said could not be revoked, strained relations with Britain and other Western nations. Nevertheless, Iran achieved normal relations with most countries under Rafsanjani and Khatami, although there were intermittent periods of political tension with European countries such as Britain, France, and Germany. In 1998 Iran’s foreign minister signed an agreement promising that the Iranian government would not implement the fatwa. This prompted Britain to restore full diplomatic relations with Iran. However, many conservative Iranian politicians insisted the fatwa was still valid, and many organizations within Iran continued to offer large bounties on Rushdie’s life.

Throughout the 1990s Iran's leaders continued to distrust the United States, which they perceived as hostile to their revolution. Likewise, the United States remained deeply suspicious of Iran's regional intentions, believing that Iran was developing weapons of mass destruction and supporting international terrorism. The two countries had unofficial contacts in the early 1990s but failed to resolve their differences. In 1993 the United States, viewing Iran as a threat to U.S. interests in the Middle East, adopted a policy to prevent Iran from gaining too much regional power. In 1995 the United States banned all U.S. trade with and investment in Iran, and in 1996 it drafted a law placing sanctions on non-U.S. companies that invest in Iran. The 1996 legislation became a source of friction between the United States and its own allies. Iran exploited the discord to expand its economic ties with Canada, European Union countries, and Japan.

Following Khatami’s election as president in 1997, the United States began reassessing its policy toward Iran. In 1998 the United States began to encourage non-official cultural exchange programs with Iran and cooperation with the Islamic Republic on international issues of mutual interest, such as finding peaceful compromises for the civil war in Afghanistan. Khatami was reelected president in 2001.