This report discusses the reasons that Iran is considered a threat to U.S. security, including Iran's nuclear program, involvement with terrorist organizations, and involvement with neighboring countries' local governments. The report also discusses ways which the U.S. hopes to modify Iran's behavior with sanctions, and the effectiveness of these sanctions.

No firms have been sanctioned under the Iran Sanctions Act (ISA), and a GAO study in December 2007 said that the effects of ISA and other U.S. sanctions on Iran's economy are "difficult to determine." However, with Iran under increasing U.N. and other diplomatic pressure, many foreign firms now seem hesitant to finalize investment deals with Iran. In the 110th Congress, several bills, including the House-passed H.R. 1400 would add ISA provisions.

A 1996 amendment to the Foreign Sovereign Immunities Act (FSIA) enables American victims of international terrorist acts supported by certain States designated by the State Department as supporters of terrorism - Cuba, Iran, North Korea, Sudan, Syria, and previously Iraq and Libya - to bring suit in U.S. courts to seek monetary damages. This report, which will be updated, provides an overview of these issues and relevant legislation (H.R. 5167).

Iran is materially assisting and influencing major Shiite Muslim factions in Iraq, most of which have ideological, political, and religious ties to Tehran. Among these factions is that of hardline anti-U.S. cleric Moqtada Al Sadr, whose Mahdi Army militia, according to some observers, serves as a proxy force for Tehran against the United States.

Iranian President Mahmoud Ahmedinejad was elected June 24, 2005, to a four-year term, becoming the first non-cleric president in 24 years. He defeated former president Akbar Hashemi Rafsanjani in a run-off. Prior to his 2005 election to the presidency, Ahmadinejad did not hold an elected office and was a virtual unknown in the international arena. This report covers his background; his victory over the well-known former president Rafsanjani; his remarks about the West, including Israel; and recent visits to Iraq and Latin America.

Iran has an active interest in developing, acquiring, and deploying a broad range of ballistic missiles. This was spotlighted in mid-July 2008 when Iran launched a number of ballistic missiles during military exercises. This report seeks to provide an overview of the reported or suspected variety of Iranian ballistic missile programs. Because there remains widespread public divergence over particulars, however, this report does not provide specificity to what Iran may or may not have, or is in the process of developing.