The US has warned Iran that it must face the consequences of its defiance over its nuclear programme.
Ms Rice said Iran might face punitive sanctions
Secretary of State Condoleezza Rice said the UN Security Council would have to look at options to compel Iran to "obey the international system".
Iran says it has succeeded in enriching uranium. The visiting head of the UN nuclear watchdog failed to convince it to freeze its nuclear programme.
China is now sending an envoy to Tehran to try to help resolve the crisis.
Chinese Assistant Foreign Minister Cui Tiankai is due in Tehran for talks on Friday.
A Chinese foreign ministry spokesman China was worried about the way the situation was developing, and the visit was aimed at facilitating dialogue among the parties concerned.
Mohamed ElBaradei, head of the International Atomic Energy Agency (IAEA) who visited Tehran on Thursday, said both sides had agreed to continue an intensive dialogue over the next few weeks.
'Reasonable and logical'
Ms Rice on Thursday raised publicly the possibility that Iran might face punitive sanctions at the UN Security Council if it did not change course.
She said that when the council reconvened on the issue at the end of the month there could not be a repeat of March's "presidential statement" in which Iran had been told to halt all sensitive atomic activities within 30 days.
Iran has so far refused to comply.
"There will have to be some consequence for that action and that defiance. We will look at a whole range of options available to the Security Council," Ms Rice said.
She said the council would have to look at a Chapter 7 resolution - which UN members are mandated to comply with.
It could possibly lead to sanctions and eventually even the use of force.
But the BBC's Justin Webb in Washington says council members Russia and China believe that talk of punishment and coercion is premature.
Beijing hopes its envoy will help defuse the situation.
BBC China correspondent Daniel Griffiths says Beijing would like to avoid sanctions and wants to take a higher profile over Iran to strengthen its credentials as a responsible, international player.
Western nations suspect Iran of wanting to develop a nuclear weapon, but Tehran insists its plans are for a peaceful, civilian energy programme only.
NUCLEAR FUEL CYCLE
Mined uranium ore is purified and reconstituted into solid form known as yellowcake
Yellowcake is chemically processed and converted into a gas by heating it to above 64C (147F)
Gas is fed through centrifuges, where its isotopes separate and process is repeated until uranium is enriched
Low-level enriched uranium is used for nuclear fuel
Highly enriched uranium can be used in nuclear weapons
On his visit, Mr ElBaradei said he had had a good discussion about "confidence-building measures".
He said there was still time to negotiate a settlement by which "Iran's needs for nuclear power is assured and the concern of the international community is also... put to rest".
But Iran's nuclear negotiator, Ali Larijani, who met Mr ElBaradei, said the UN's demand for a return to a freeze of its nuclear programme was not the way to solve the problem.
"Every action must be reasonable and logical. We are co-operating in a constructive manner" with the IAEA, "so such a proposal is not very important to solve the problem," he said.
Earlier, Iranian President Mahmoud Ahmadinejad said: "Our answer to those who are angry about Iran obtaining the full nuclear cycle is one phrase, we say: Be angry and die of this anger.
"We will not hold talks with anyone about the Iranian nation's right [to enrichment] and no-one has the right to step back, even one iota," he said.