This study analyzes recent developments in U. S.- Iranian relations during the Nixon administration and attempts to portray the principal objectives of the United States and Iran vis-a-vis each other. Complex Interdependence is the model for development of the arguments. Due to the circumstances, however, the study substantially draws on Realism as well. Chapter I discusses methodology. Chapter II focuses on the Nixon Doctrine and its impact on U. S.-Iranian relations. Chapter III discusses the evolution of mutual interests between the two nations in the Gulf area. Chapter IV drawing on the previous chapters, concludes that an interdependent relation between the two nations has developed to the extent that in some areas policy of one nation would have an impact on the other, i.e., increase in the price of oil.