"The Russian proposal is not sufficient for Iran's nuclear energy needs," Mr Larijani told reporters on arrival back from China, according to Iranian media.
"However, one can not say that it is a negative proposal," he said.
Mr Larijani, secretary of Iran's Supreme National Security Council, however said that "one can not say that it is a negative proposal", and said talks would continue with Moscow.
This comes less than two days after Tehran expressed qualified support for a plan to enrich its uranium on Russian territory, in order for the process to be monitored and allay Western and Israeli fears that Iran secretly plans to build a nuclear weapon under the cover of the civilian power project.
"The Russian proposal has certain capabilities, but this capability is not sufficient for Iran's nuclear technology," he said.
"We had a round of talks over it and we will do the next round."
The EU, China and US President George W Bush have backed the plan.
However US Secretary of State Condoleezza Rice said Washington would insist on referring Iran to the UN over its nuclear program and said the Russian plan was merely a delaying tactic ahead of a UN nuclear watchdog meeting next month.
"The Iranians are "doing nothing but trying to throw up chaff so that they are not referred to the (UN) Security Council and people shouldn't let them get away with it," Ms Rice told Reuters news agency.
The International Atomic Energy Agency is meeting in Vienna on February 2 to debate whether to send Iran to the Security Council.
Western powers want the Security Council to suspend its nuclear fuel work, however are yet to agree on the wording.
The US, UK, Germany and France have been haggling with Russia and China over the wording of the draft resolution for the emergency IAEA meeting, which recommends that the Security Council makes clear to Iran that "outstanding questions" can be resolved by Iran responding to IAEA calls for a suspension of nuclear work.
Russia is resisting the pivotal clause because it fears Tehran's failure to meet the demand would inflame the situation and lead to possible sanctions, according to an AFP report.