Iran's detention of 15 Royal Navy personnel is "unjustified and wrong", Prime Minister Tony Blair has said.
The 15 are based on HMS Cornwall, which patrols Iraqi territorial waters
UK officials are waiting to be granted access to the HMS Cornwall staff, who were seized on Friday, and have not been told where the group are held.
Hardline students close to Iran's president have called for the sailors to be put on trial.
Iran says they were trespassing in its waters, but speaking at an EU summit, Mr Blair denied this was the case.
"It simply is not true that they went into Iranian territorial waters and I hope the Iranian government understands how fundamental an issue this is for us," Mr Blair said.
"We have certainly sent the message back to them very clearly indeed. They should not be under any doubt at all about how seriously we regard this act, which is unjustified and wrong."
The prime minister, in Berlin for the EU's 50th anniversary celebrations, said he had not commented up to now because he wanted the incident to be resolved in "as easy and diplomatic a way as possible".
He added: "It is the welfare of the people that have been taken by the Iranian government that is most important."
BBC security correspondent Gordon Corera said officials in the Foreign Office were stepping up their efforts to free the sailors and marines.
But they acknowledged that negotiations with Iran can be both delicate and difficult.
It is also feared that the fate of the captured personnel has become part of a wider crisis centring on Iran's nuclear programme, our correspondent said.
On Saturday, the UN Security Council voted unanimously in favour of further sanctions against Iran for its refusal to suspend its nuclear enrichment programme.
And on Sunday evening Iran's President, Mahmoud Ahmadinejad, responded that it would restrict co-operation with international inspectors.
Elsewhere, Iranian Foreign Minister, Manouchehr Mottaki, told reporters in New York that the captured Britons were involved in "the illegal entrance into Iranian territorial waters and this issue is being considered legally".
Students belonging to the paramilitary Basij group, which is close to Iranian President Mahmoud Ahmadinejad, have called for the Britons to be put on trial.
But the Foreign Office is adamant that the 15 were in Iraqi waters and has called for their immediate release.
Foreign Secretary Margaret Beckett had a telephone conversation with her Iranian counterpart during the evening.
A spokesman said she made it "very clear" that no violation of Iranian waters had occurred. She also appealed for information on the whereabouts of the group and for consular access.
The navy personnel, who include one woman, were seized at gunpoint by forces said to be Iranian Revolutionary Guards, after inspecting an Iraqi boat and returning to their two small boats to head back to the Cornwall.
Germany - which holds the EU presidency - has called for the immediate release of the Britons.
The seizure of the boarding party carries echoes of an incident in June 2004 when a group of eight marines and sailors were held for three days after being seized by the Iranians in the Shatt al-Arab waterway.
They were paraded blindfolded on television and later freed.