Iran's electoral crisis deepened on Saturday with the government warning a parliamentary vote lacked legitimacy and could not be held due to the mass disqualification of reformist candidates by a hard-line watchdog.
With elected reformists and appointed hard-liners apparently further than ever from compromise over the February 20 poll, President Mohammad Khatami's office denied a report by the official IRNA news agency earlier on Saturday that he had told reporters talks to resolve the crisis were at a "dead-end".
"Khatami did not say such a thing," a spokesman told Reuters.
Khatami has expressed hope the row could be solved through negotiations and a competitive vote will be held on schedule.
But his optimism appeared at odds with most of his allies. Reformist MPs said they would announce mass resignations in coming days and may boycott the election altogether.
The candidate bans meant reformists could not contest more than half of parliament's 290 seats, the interior minister said.
"An election in which more than half of the seats are pre-determined is not legitimate," Abdolvahed Mousavi-Lari, whose ministry is responsible for organising the vote, told IRNA.
Asked if the government would hold the election, he said: "It cannot unless there is some change."
He was speaking a day after the Guardian Council - a body of 12 clerics and Islamic jurists - confirmed the bans on more than 2,000 of the 8,200 hopefuls from standing in the election.
Reformists accuse the council of a crude attempt to help conservatives overturn their defeat in 2000 elections.
The number of sitting deputies barred has risen to 87, from 83, Mousavi-Lari said. They included the most outspoken and well-known reformist figures, such as deputy speaker Mohammad Reza Khatami, younger brother of the president.
"It would be a shame for the government to hold the first ever sham election and Khatami should not do so," said Ali Tajernia, one of some 100 MPs holding a three-week sit-in protest at parliament over the candidate bans.
The row has raised concern abroad about the future of democracy in Iran, which next month marks the 25th anniversary of the Islamic revolution that brought clerics to power.
Hardliners said the government could not abandon its duty.
"According to the law, the Interior Ministry is obliged to hold the elections on the legally appointed date," Guardian Council member Reza Zavarei told the ISNA students news agency. He said the bans confirmed on Friday could not be appealed.
With talks between the government and Guardian Council apparently at a standstill, analysts said the last possibility of a solution rests with Supreme Leader Ayatollah Ali Khamenei.
But Khamenei, who has the last word on state matters, has so far limited his intervention in the crisis to encouraging both sides to talk and for the council to carefully review the bans.
Despite the intensifying political atmosphere, public interest in the dispute remained muted. After years of broken promises of reform, most Iranians have grown increasingly disengaged from the reformist-conservative power struggle.
Khatami, taking a swipe at the conservative clerics blocked his reforms for the past seven years, criticised those who hindered democracy in the Islamic Republic.
"Those who safeguard the Islamic Republic are those who believe in Islam and in republicanism," he told state television.
Khatami has resisted calls from allies to resign and vowed to complete his second term of office, which ends next year.