Iranian police said on Saturday they had found papers linking Britain and the United States to vaguely identified "bandits" in a border province which is a drug smuggling centre and a base for Sunni Muslim guerrillas.
A British diplomat in Tehran said Britain had nothing to do with mounting lawlessness in the south eastern province of Sistan-Balochistan. The United States has no embassy in Iran.
Iran has previously blamed Britain and the United States for bombings and killings in its increasingly volatile frontier regions where unrest is simmering among Kurdish, Arab and Baloch minorities. Washington and London deny any involvement.
Iranian police spokesman Mehdi Ahmadi said security forces had destroyed a bandit stronghold in the Pirsouran mountains of Sistan-Balochistan, which borders Afghanistan and Pakistan. The main opium smuggling route to Europe crosses the province.