In the ensuing chaos some victims were counted more than once
Iran has significantly lowered the death toll from the Bam earthquake.
The authorities now say 26,271 were killed when much of the city was flattened on 26 December.
Previously it was said that more than 41,000 had died, but apparently some victims were counted more than once in the chaotic aftermath of the disaster.
Iran's statistics office said a census had been conducted to determine the exact number killed and that 525 people were still missing.
Abbas Ali Zali, the head of the statistics office, said the new figure covered the city of Bam as well as its surrounding areas and districts, where a total of 142,376 people were living.
Most of the mud brick buildings in the historical city, including its ancient citadel, collapsed when the massive earthquake struck at dawn.
The quake destroyed 70% of the city's buildings. Tens of thousands of people were injured and left homeless.
International agencies such as the United Nations and Red Cross have been raising money and sending supplies to Bam, where the long-term cost of reconstruction is estimated to be $1bn.