The UK foreign secretary has welcomed the decision to report Iran to the United Nations Security Council.
Jack Straw said the move demonstrated how determined the international community was to halt the spread of nuclear weapons in the Middle East.
He said that if Iran did not suspend its nuclear activities, then action from the Security Council would be "almost inevitable".
In response Iran said it would halt snap UN checks of nuclear facilities.
President Mahmoud Ahmadinejad said the move was in response to Iran being reported to the Security Council over its programme.
The announcement came after a senior Iranian official said Tehran would resume full-scale enrichment of uranium following the referral.
"I have great respect for Iran, its people and history. We both stand to benefit from a better political and economic relationship"
Mr Straw said the vote by the United Nations nuclear watchdog gave Iran several weeks to defuse the crisis by suspending its activities.
If the Security Council was forced to act, it could include sanctions against the Tehran regime.
The foreign secretary also made clear that there could be no restoration of good political and economic relations with Tehran until it proved to the world "beyond any doubt" that it is not seeking to produce nuclear weapons.
In a statement, Mr Straw said: "The IAEA Board has passed a resolution reporting Iran to the United Nations Security Council."
He said the voting - 27 in favour, with three against and five abstentions - was "a significant improvement in the international consensus since the last resolution in September 2005".
He added "The scale of the vote in this resolution's favour is significant. It signals the international community's determination to prevent the spread of nuclear weapons in the Middle East."
Military action
Mr Straw said the move presented Iran with a "crucial opportunity" to comply with the latest resolution and take "the steps required to address all outstanding questions from the IAEA".
He said: "I have great respect for Iran, its people and history. We both stand to benefit from a better political and economic relationship.
"But before that can happen the Iranian regime must prove to the international community beyond any doubt that it is not seeking nuclear weapons."
The Defence Secretary John Reid refused to speculate on the possible use of military force against Iran.
He said: "The truth of the matter is that we have avidly perused a diplomatic solution.
"But at the end of the day, I think that they [the people of Iran] will have to recognise that their present government is putting them in a position which is standing them at odds with and against the whole of the civilised world."
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