UN Resolution 1696, adopted on Monday, warned the Islamic Republic that it might face sanctions unless it halts uranium enrichment and other work that could help build a nuclear bomb.

"While the Security Council does not dare to condemn the Qana massacre (in south Lebanon) ... it feels alarmed by Iran's nuclear activities and adopts a resolution that is worthless in the eyes of people," parliament speaker Gholam-Ali Hadad-Adel was quoted as saying by the ISNA news agency.

The resolution was also decried as "destructive and totally unwarranted" by Iran's UN ambassador.

"I would suggest to you that this approach will not lead to any productive outcome. It can only exacerbate the situation," Javad Zarif told the Security Council in New York.

"The Americans must be sure that Iran will not take part in a game which it will lose," Kazem Jalali, spokesman for the Iranian parliament's influential foreign affairs commission, was also quoted as saying by the ISNA news agency.

"If there were to be a loser, it would be those who have shifted the Iranian nuclear issue away from dialogue," he warned.

The Security Council gave Tehran an August 31 deadline to comply, and said that International Atomic Energy Agency (IAEA) chief Mohammed ElBaradei should then report back on what Iran has done to fall into line.

Iran insists it only wants to enrich uranium to make reactor fuel and that this is a right enshrined by the nuclear Non-Proliferation Treaty (NPT).

Demands for a suspension stem from widespread suspicions the country wants the capacity to make weapons-grade uranium.

The resolution was pushed through after Iran ignored a previous but non-binding deadline and failed to respond to an offer of incentives in exchange for a moratorium.

But the text held off from an immediate threat of sanctions, which have been opposed by Russia and China, and said any punitive action would have to be the subject of further discussions.

Russian Deputy Foreign Minister Sergei Kislyak said the resolution was "balanced and gives every opportunity for continuing the process of negotiations", although he did warn that "the Security Council could examine further steps to persuade Iran."

"Of course, no one is going to look at any use of force," he was quoted by Interfax as saying.

But a state radio commentator said the resolution was merely fresh proof that "Western countries want to prevent Iran from having an independent nuclear energy programme."

"A powerful Iran which masters the latest technology is against their interests," the commentator said, adding that "history has shown that when the people have a goal and the government supports them, nothing can hold them back."

An editorial in the ultra-hardline Siasat Rouz newspaper called on the government to quit the NPT -- something officials have already threatened to do if the pressure mounts.

"In preparing the final battle, we should at first attack US bases in neighbouring countries and then clear the region of this infected microbe," the paper said, while also calling on Iran to rally "friendly governments and Muslim people ready to carry out suicide attacks".

"It shows the Security Council has sadly become an instrument in the hands of the Americans," the hardline Jomhuri Eslami paper fumed. "Iran will undoubtedly respond by suspending its adhesion to the NPT."

And the hardline Kayhan newspaper, whose firebrand editor is appointed by supreme leader Ayatollah Ali Khamenei, said the UN order "does not carry the necessary weight."

"The objective... is to threaten Iran rather than take action," the paper said.

The text represents a diplomatic victory for the United States, which has long been pushing for tough action.

"The clock has begun to tick," said John Bolton, the US ambassador to the United Nations. "The ball is now clearly in Iran's court. The choice is up to them."

US Secretary of State Condoleezza Rice also said she was "confident that we have very good cooperation with Russia and China on this issue", while asserting that the resolution "does not close the door to diplomacy".

"We remain committed to a negotiated solution," British Foreign Secretary Margaret Beckett also declared.

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