The Pentagon has hit back at claims by investigative reporter Seymour Hersh that US commandos have been carrying out covert operations inside Iran.
US special forces have been operating inside Iran, Hersh says
A spokesman said Hersh's New Yorker magazine article was based on rumour, innuendo and conspiracy theories.
But correspondents say he did not clearly deny that US troops have been on the ground in Iran.
Hersh insists that for six months US forces there had been identifying military targets for future strikes.
Hersh, an award-winning reporter who last year revealed abusive practises at the US military's Abu Ghraib prison in Iraq, quotes unnamed intelligence officials as saying Iran is the Bush administration's "next strategic target".
The issue could be raised later on Tuesday when the President George W Bush's choice for his new Secretary of State, Condoleezza Rice, faces a confirmation hearing before a Senate committee.
The BBC's Justin Webb in Washington says that while Hersh could be wrong, he has a series of scoops to his name, including the details of the Abu Ghraib prison abuse scandal last year.
His track record suggests that he should be taken seriously, our correspondent says.
Hersh says reliable sources told him that the political masters in the Pentagon - Defence Secretary Donald Rumsfeld and his deputy Paul Wolfowitz - wanted to destroy Iran's military infrastructure.
Pentagon spokesman Laurence DiRita said on Monday that Hersh's article did not do justice to the "global challenge" posed by the "Iranian regime's apparent nuclear ambitions and its demonstrated support for terrorist organisations".
Mr DiRita said the article was "so riddled with errors of fundamental fact that the credibility of his entire piece is destroyed".
"Views and policies" ascribed by Hersh to several top US defence department officials were not accurate, he said.
Hersh told the BBC the White House is trying to make a plausible case that Tehran is cheating UN nuclear inspectors in order to justify possible future military action against it.
"There is plausible deniability - of course they [the Bush administration] don't want it known," he said.
"But it's very simple. This administration has won a new election, and the president if pretty clear about what he says - he has a mandate to carry out, to democratise the Middle East, and Iran is next."
He says the Pentagon is taking over much of the responsibility for covert "deniable" military operations from the CIA, in what amounts to an "intelligence coup" within the US.
In his article he said the US commandoes were aided by intelligence from Pakistan, but a Pakistani foreign ministry spokesman has described the reports of collaboration with the US over Iran as "far-fetched".