Friday's earthquake in the Iranian city of Bam may have killed up to 50,000 people, officials say, making it one of worst quakes in modern times.
Many survivors are camped out in the freezing cold
Aid workers caring for some 100,000 survivors are calling for more help.
American doctors have joined the aid effort despite years of deep hostility between Washington and Tehran.
Iran's president welcomed the US help but said there was no prospect of dialogue unless Washington changed its policy towards his country.
US Secretary of State Colin Powell has said Washington is open to a possible dialogue with Iran following "encouraging moves" there.
In an interview with the Washington Post on Tuesday, Mr Powell said he still had concerns about Tehran's alleged terrorist links but recent events had shown a new attitude in Iran.
This month Iran agreed to allow unannounced international inspections of its nuclear facilities.
Tehran's acceptance of American aid for the earthquake victims has also been taken as an encouraging sign.
President Mohammad Khatami, who is in the region to see the damage for himself, thanked the US and other nations for their assistance.
But he sought to play down the political significance of the US aid, saying it would not change anything without a profound shift in America's attitude towards Iran.
"What is the point of negotiations if there is no trust that will enable us to reach a common position," Mr Khatami told reporters on a visit to the regional capital, Kerman.
About 80 American medical experts and rescue workers have gone to the earthquake zone, and US aid supplies have been arriving in the country.
"These are doctors. They are not Mr Bush or Mr Rumsfeld coming to kill us," Deputy Health
Minister Mohammad Akbari said, referring to the US president and his defence minister.
"This is not help from Mr Bush. This is help from humanitarian people."
Nearly 30,000 bodies about been pulled from the rubble, but the number of dead seems set to be much higher. The final figure may never be known as entire families have died and there is no-one left to register them as missing.
"If we consider that, on average, five people lived in each house we can say the death toll will reach 50,000," one Iranian official told Reuters news agency
However, President Khatami told reporters he believed the number of dead was not quite as high, and would be about 40,000.
He pledged to rebuild Bam's 2,000-year-old citadel "whatever the cost", promising to rebuild the city within two years.
But the immediate challenges are huge.
Some 80% of Bam's mud-brick buildings were flattened in Friday's pre-dawn quake, according to the Iranian Government.
Aid workers say basic items like shoes, clothes and cooking utensils are a priority, while longer-term equipment like prefabricated homes and mobile hospitals will be needed.
The BBC's Paul Anderson in Bam says many survivors are still camped outside their homes, huddled around pathetic fires in the cold waiting for the aid effort to reach them.
Gulf states usually hostile to the Islamic Republic have pledged $400m for reconstruction.
The authorities expect that the recovery of bodies - and the mass burials which accompanies it - to continue into next week.
The historical heart of the city has been largely reduced to dust and for some it holds no future despite the government's pledges to rebuild.
"This town has been destroyed - I'm taking my belongings to Tehran," Assad Najafi, 24, told Reuters news agency as he gathered up merchandise from his ruined car spares shop.