The UK will restore some diplomatic relations with Iran by appointing a charge d’affaires to work there, William Hague has said.
But the foreign secretary warned the country’s president to follow up his more “positive” words on its alleged nuclear weapons programme with “concrete actions”.
Mr Hague told MPs further progress would require “substantial change”.
Iran will send a charge d’affaires to London in return, he said.
Mr Hague said it was hoped this would help “on the way towards eventual re-opening of both our embassies”.
The UK shut its embassy in Tehran in November 2011 after it was attacked by protesters.