Iran–United States relations during the George W. Bush administration (2001–2009) were marked by heightened tensions, mutual distrust, and periodic attempts at limited engagement. Following the September 11 attacks in 2001, Iran initially was sympathetic with the United States.P.I.R.I News Headlines (Tue 80/07/03 A.H.S). The Official Site of the Office of the President of Iran. Official website of the President of the Islamic Republic of Iran. 25 September 2001. Permanent Archived Link. Original page and URL are not available online now. (Website's Homepage at that time (Title: Presidency of The Islamic Republic of Iran, The Official Site)) However, relations deteriorated sharply after President George W. Bush labeled Iran part of the "Axis of Evil" in 2002, accusing the country of pursuing weapons of mass destruction that posed a threat to the U.S. In 2003, Swiss Ambassador Tim Guldimann relayed an unofficial proposal to the U.S. outlining a possible "grand bargain" with Iran. He claimed it was developed in cooperation with Iran, but it lacked formal Iranian endorsement, and the Bush administration did not pursue the offer.

Between 2003 and 2008, Iran accused the United States of repeatedly violating its territorial sovereignty through drone incursions,U.S. Uses Drones to Probe Iran For Arms , February 13, 2005, The Washington PostIran Protests U.S. Aerial Drones , November 8, 2005, The Washington Post covert operations, and support for opposition groups.Kucinich Questions The President On US Trained Insurgents In Iran: Sends Letter To President Bush , Dennis Kucinich, April 18, 2006 In August 2005, Mahmoud Ahmadinejad became Iran's president. During his presidency, attempts at dialogue, including a personal letter to President Bush,"Timeline: US-Iran ties." BBC News. Retrieved 29-10-2006. were dismissed by U.S. officials,Vick, Karl. "No Proposals in Iranian's Letter to Bush, U.S. Says." The Washington Post. Retrieved 29-10-2006. while public tensions grew over Iran’s nuclear program, U.S. foreign policy, and Ahmadinejad’s controversial remarks at international forums.

The United States intensified covert operations against Iran, including alleged support for militant groups such as PEJAK and Jundullah, cross-border activities, and expanded CIA and Special Forces missions. Iran was repeatedly accused by the U.S. of arming and training Iraqi insurgents, including Shiite militias and groups linked to Hezbollah, with American officials citing captured weapons, satellite images, and detainee testimonies. During this period, additional flashpoints included the U.S. raid on Iran's consulate in Erbil, sanctions targeting Iranian financial institutions, a naval dispute in the Strait of Hormuz, and the public disclosure of covert action plans against Iran.

State of Iran-U.S. relations in January 2001

At the outset of the George W. Bush administration in January 2001, Iran was led by President Mohammad Khatami, a reformist known for advocating dialogue with the West, while ultimate authority rested with Supreme Leader Ali Khamenei, who held decisive power over Iran’s foreign and security policies. The previous Clinton administration had adopted a policy of dual containment toward Iran, which included efforts to restrain it from taking actions seen as harmful to the interests of the United States, but it had also responded positively to President Khatami’s 1998 call for dialogue with the American people.

September 11 attacks

On September 25, 2001, Iran's president Mohammad Khatami meeting British Foreign Secretary, Jack Straw, said: "Iran fully understands the feelings of the Americans about the terrorist attacks in New York and Washington on September 11." He said although the American administrations had been at best indifferent about terrorist operations in Iran (since 1979), the Iranians instead felt differently and had expressed their sympathetic feelings with bereaved Americans in the tragic incidents in the two cities. He also stated that "Nations should not be punished in place of terrorists." According to Radio Farda's website, when the attacks' news was released, some Iranian citizens gathered in front of the Embassy of Switzerland in Tehran, which serves as the protecting power of the United States in Iran (US interests protecting office in Iran), to express their sympathy and some of them lit candles as a symbol of mourning.

This piece of news at Radio Farda's website also states that in 2011, on the anniversary of the attacks, the United States Department of State published a post at its blog, in which the Department thanked Iranian people for their sympathy and stated that they would never forget Iranian people's kindness on those harsh days.تشکر وزارت خارجه آمریکا از همدردی ایرانیان با قربانیان ۱۱ سپتامبر. (Persian). Radio Farda. Sunday, September 11, 2011. (Iranian Hijri date: ۱۳۹۰/۰۶/۲۰). . Retrieved and Archived on June 30, 2016. Mechanized Translation by Google Translate is available, here. The attacks were condemned by both the President and the Supreme Leader of Iran.Iran mourns America's dead Time BBC and Time magazine published reports on holding candlelit vigils for the victims by Iranian citizens at their websites. Permanent Archived Link. According to Politico magazine, following the attacks, Sayyed Ali Khamenei, the Supreme Leader of Iran, "suspended the usual "Death to America" chants at Friday prayers" temporarily. The military forces of the United States of America and the Islamic Republic of Iran cooperated with each other to overthrow the Taliban regime which had conflicts with the government of Iran."34 Years of Getting to No with Iran". Politico. Barbara Slavin. November 19, 2013. Permanent Archived Link. Permanent Archived Link at WebCite. Retrieved and archived on July 4, 2016. Iran's Quds Force helped US forces and Afghan rebels in 2001 uprising in Herat.

"Axis of evil" speech

On January 29, 2002, U.S. President George W. Bush labeled Iran, along with North Korea and Iraq, as part of the "Axis of Evil" in a speech. He added that Iran aggressively pursues missiles and weapons of mass destruction and supports militant groups abroad, while a small, unelected elite suppresses the Iranian people's aspirations for freedom. The speech sparked outrage in Iran, drawing condemnation from both reformists and conservatives, with Masoumeh Ebtekar calling it a "strategic mistake" by the Bush administration. Daniel Heradstveit and G. Matthew Bonham argued that the speech caused a reversal in friendly US–Iranian relations that had developed after the Cold War; the Iranian opposition figures they interviewed saw it as a "betrayal", and widely agreed that it was "a godsend to the conservatives", who favored a more hostile and militant approach towards the United States.

Guldimann's "Grand Bargain" proposal

On 4 May 2003, the Swiss government sent the U.S. State Department an unsigned one-page memorandum, which was not on official letterhead, and contained a cover letter by Swiss diplomat Tim Guldimann which laid out a roadmap for discussions between Iran and the U.S. In the cover letter, Guldimann claimed that he developed the document with Sadegh Kharazi, the Iranian ambassador in Paris, and that Supreme Leader Ali Khamenei agreed with 85–90% of the paper, although he could not obtain a precise answer on what exactly the Leader explicitly has agreed.

The document outlined several topics for potential negotiations between the two countries and suggested establishing three parallel working groups focused on disarmament, regional security, and economic cooperation. Among the central issues were:

The lifting of all U.S. sanctions imposed on Iran Joint efforts with the United States to support stability in Iraq Complete openness regarding Iran's nuclear activities, including implementation of the Additional Protocol Collaboration in combating terrorist groups, especially the Mujahedin-e Khalq and al-Qaeda Acknowledgement of the 2002 Arab League “land for peace” declaration concerning Israel and Palestine Unrestricted Iranian access to civilian nuclear technology, along with chemical and biotechnological advancements The Bush administration rejected the proposal, opting instead to increase pressure on Iran.

Presidency of Mahmoud Ahmadinejad

In August 2005, Mahmoud Ahmadinejad became Iran's president. On 8 May 2006, he sent a personal letter to President Bush to propose "new ways" to end Iran's nuclear dispute. US Secretary of State Condoleezza Rice and National Security Adviser Stephen Hadley dismissed it as a negotiating ploy and publicity stunt that did not address American concerns about Iran's nuclear program. Ahmadinejad later said that "the letter was an invitation to monotheism and justice"."President says his letter to President Bush was invitation to Islam." Islamic Republic News Agency. Retrieved 29-10-2006.

Bush insisted in August 2006 that there must be consequences for Iran's continued enrichment of uranium. He said that "the world now faces a grave threat from the radical regime in Iran." Ahmadinejad invited Bush to a debate at the UN General Assembly, which was to take place on September 18, 2006. The debate was to be about Iran's right to enrich uranium. The invitation was promptly rejected by White House spokesman Tony Snow."No 'steel-cage, grudge match' between Bush, Ahmadinejad." CNN. Retrieved 10-01-2007.

In November 2006, Ahmadinejad wrote an open letter to the American people,"Ahmadinejad's letter to Americans." CNN. Retrieved 26-01-2008. stating that dialogue was urgently needed because of American activities in the Middle East and that the United States was concealing the truth about relations."Message of H.E. Dr. Mahmoud Ahmadinejad President of the Republic of Iran to the American People." Fox News. Retrieved 29-11-2006.

2007 Visit to the U.S.

In September 2007, Ahmadinejad visited the United States. He gave a speech at Columbia University, after a harsh reception from the university president Lee Bollinger, who accused the strict ruler of acting like “a petty and cruel dictator.” Ahmadinejad answered a query about the treatment of gays in Iran by denying the existence of homosexuality in his country. An aide later said he was misrepresented and meant that, compared to American society, Iran has fewer homosexuals.

Ahmadinejad was not permitted to lay a wreath at the World Trade Center site. In an interview he said, "Many innocent people were killed. We are very much against any terrorist action and killing, and against sowing discord among nations. You usually go to such sites to pay respects and discuss root causes." When told that some Americans saw Iran as exporting terrorism and would be offended by the photo op, he replied, “How can you speak for the whole American nation? ... It has 300 million people with different views.”

The next day, Ahmadinejad addressed the UN General Assembly. He defended Iran’s nuclear program as entirely peaceful and transparent. He charged the United States and its allies with hypocrisy for criticizing his government, pointing to practices like secret prisons, abductions, lack of due process, and widespread surveillance.

Later statements In an April 2008 speech, Ahmadinejad described the September 11 attacks as a "suspect event", saying that all that happened was a building collapsed. He stated that the death toll was never published, the victims' names were never published, and that the attacks were used subsequently as pretext for the invasions of Afghanistan and Iraq. That October, he expressed happiness about the 2008 global economic crisis. He said the West has been driven to a dead-end and that Iran was proud "to put an end to liberal economy". The previous month, he had told the UN General Assembly, "The American empire in the world is reaching the end of its road, and its next rulers must limit their interference to their own borders".