Turkcell, Turkey's biggest mobile phone operator, has been awarded a contract to set up Iran's first private mobile phone network.
The company is expected to invest about $3bn in the project - making it one of the biggest foreign investments in Iran since the 1979 Islamic revolution.
Iran's state monopoly TCI has about three million subscribers but demand is expected to soar to 30 million by 2009.
Turkcell's lines will start operating in 11 months' time, an official said.
Reuters quoted Masoum Fardis of Iran's communications ministry as saying Turkcell could expect to win 16 million subscribers within 15 years.
He also said Iran would put out to tender a third mobile phone licence in two years' time.
Turkcell is to pay 300m euros ($385m; £202m) up-front for its licence. Further fees and taxes depend on revenues the company is able to generate.
Unsuccessful bidders for the contract included Kuwait's Mobile Telecommunications Company, South Africa's MTN and Orascom Telecom of Egypt.