The US says it will seek a "strong" statement by the Security Council against Iran and wants a diplomatic solution to the dispute. The US believes Iran's nuclear program is hiding efforts to develop an atomic bomb.
The Security Council is expected to start debating Iran next week, after a report by the International Atomic Energy Agency (IAEA) was referred to the world body.
Iran's hardline regime was digging in for a confrontation with the US with its supreme leader vowing not to halt a disputed nuclear drive despite the prospect of almost certain action by the UN.
Unlike the IAEA, the Security Council has enforcement powers and can impose punitive measures, including sanctions. The aim is to force Iran to abandon uranium enrichment work, which can provide the fuel for civilian reactors but also material for atomic weapons.
Iran defiant
"Today, the Iranian people and the officials of the Islamic republic of
Iran, more powerful than before and like steel, will stand against any pressure or conspiracy," a defiant Ayatollah Ali Khamenei said.
He vowed that Iran, "relying on God and using wisdom and rationale and by maintaining unity, will continue on the path to advanced technology, including nuclear technology."
Describing the stand-off as a "matter of destiny" after a quarter of a century of tensions with Washington, Ayatollah Khamenei also urged Iranians to brace for "possible pain and trouble".
"If the Iranian people and the government retreats from its right to nuclear technology, the (American) adventure will not end and the Americans will come up with another pretext," Ayatollah Khamenei said.
"We should stand firm on the matter, and... by enduring possible pain and trouble will be victorious."
Hardline President Mahmoud Ahmadinejad also struck a defiant tone, declaring that "the time for bullying is over" and that the West "can not do a damn thing" against Iran.
"Some powers think that if they sit in a session, they can force the Iranian people to retreat. But all the Iranian nation, young or old, urban dweller or villager and farmer or factory worker are all saying one thing: nuclear energy is our undeniable right," he said.
Tehran has proposed suspending industrial-scale enrichment, but it is refusing to halt enrichment research and the Western powers argue that even this would allow the clerical regime to acquire nuclear weapons know-how.
Iran's Assembly of Experts, an 86-member council of top clerics, also issued a statement warning the country's opponents of a "heavy price" if tensions escalate further.
Iran a great challenge
US Secretary of State Condoleeza Rice told Congress in Washington that the United States faces no greater challenge than Iran.
She urged Congress to adopt a package aimed at promoting democracy in the Islamic republic.
"We may face no greater challenge from a single country than from Iran, whose policies are directed at developing a Middle East that would be 180 degrees different than the Middle East we would like to see develop," Ms Rice told the Senate Appropriations Committee.
"This is a country that is determined, it seems, to develop a nuclear
weapon in defiance of the international community that is determined that they should not get one."
Rice, who appeared before the committee along with Defense Secretary Donald
Rumsfeld, accused Tehran of being "the central banker for terrorism" and of backing terrorist activities in southern Iraq, the Palestinian territories and in Lebanon.
Mr Rumsfeld also said that the US has no plans to attack Iran but warned that US forces would take "appropriate" action to stop Iranian forces infiltrating Iraq.
General Peter Pace, the chairman of the Joint Chiefs of Staff, was more explicit in warning before a Senate committee that any Iranian forces that engage US troops in Iraq would be treated as enemy forces.
Mr Rumsfeld accused Iran of infiltrating people into Iraq to do "damaging and dangerous" things to US forces and warned that "our forces will certainly take the appropriate steps to stop them."
Russia seeks co-operation
Meanwhile Russia called on Iran to cooperate fully with the UN nuclear watchdog and repeated its offer to coordinate a compromise solution to the crisis by having Tehran enrich uranium on Russian soil.
Foreign Minister Sergei Lavrov also said that President George W Bush had assured him of Washington's "prudence" in handling the affair.
"We appeal with the greatest concern to Iran to study the conclusions of the IAEA session and to cooperate fully with the IAEA", the Russian foreign ministry said in a statement.
Mr Lavrov has denied the possibility of a "military solution" to the crisis and has also criticised the effectiveness of any sanctions
Mr Lavrov said that Mr Bush had assured him in a meeting Tuesday that Washington would act cautiously.
Envoys of Britain, China, France, Russia and the United States, the five veto-wielding, permanent members of the Security Council, have already discussed the issue. The 15-member council could formally take up the case in the course of next week.