The Iranian government is breaching the 2015 nuclear pact, as it ratchets up pressure on the US to lift economically damaging sanctions.
Iran has stepped up its defiance of the landmark 2015 nuclear deal reached with the west, saying it has boosted its uranium enrichment above the set cap.
President Donald Trump, who withdrew the US from the deal and reimposed sanctions, is now pressuring Tehran to renegotiate the pact, saying "Iran had better be careful".
France, Germany and Britain have also expressed concerns over the latest step taken by Tehran.
Meanwhile, senior Iranian officials threatened further violations, saying Tehran would keep reducing its commitments every 60 days unless European parties to the agreement protected it from US sanctions ravaging its economy.
"We are fully prepared to enrich uranium at any level and with any amount," said Behrouz Kamalvandi, spokesman for Iran's Atomic Energy Organisation.
"In a few hours the technical process will come to an end and the enrichment beyond 3.67% will begin," he added, referring to the limit set in the 2015 agreement.
Speaking to reporters as he departed Morristown, New Jersey, President Trump warned Tehran. "Iran better be careful. If you enrich for one reason and I won't tell you what that reason is but it's no good. They'd better be careful," he said.
Iran is 'doing a lot of bad things', Trump said but did not elaborate. "The way they want it, they would have automatic rights to have nuclear weapons. Iran will never have a nuclear weapon," he added.
Iran's main demand - in talks with the European parties to the deal and as a precondition to any talks with the United States - is to be allowed to sell its oil at the levels before Washington pulled out of the agreement and restored sanctions.
The confrontation has taken on a military dimension, with Washington blaming Tehran for attacks on oil tankers, and Iran shooting down a U.S. drone, prompting aborted U.S. air strikes.
The European Union strongly urged Iran to stop actions that would undermine the pact, saying it was in touch with other parties and may set up a joint commission to examine the issue.
Iran has left a door open for negotiations.
All measures taken to scale back its commitments to the agreement were "reversible" if the European members of the pact fulfilled their obligations, Foreign Minister Mohammad Javad Zarif tweeted on Sunday.
Daniel Byman, senior fellow for foreign policy at the Brookings Institution, said Iran was engaged in a tricky balancing act.
"The step is meant to show domestic audiences that Iran is standing up to U.S. pressure. It is also meant to convey a sense of risk to European audiences that Iran may provoke a crisis," he said.
Inspectors from the U.N. nuclear watchdog who are in Iran will report back once they have checked that Tehran has enriched uranium to a higher level of purity than that allowed under the deal, the agency said.