A new report by the International Atomic Energy Agency (IAEA) says Iran has improved its capacity to rapidly refine uranium by installing hundreds more centrifuges.
The IAEA report noted that Tehran was going ahead with the building of a new research reactor.
Western experts see it as a possible second venue for producing material for a nuclear weapon.
The report, however, showed limited increase in the country's most sensitive atomic stockpile.
The report says that the rise is still considered below an Israeli "red line."
Israel has threatened military strikes if diplomacy and sanctions fail to stop Iran's nuclear ambitions.
Critics see Tehran trying to achieve the capability to make nuclear weapons. But Iran says its nuclear program is entirely peaceful and is pushing for its "right" to enrich uranium recognized.
Based on reporting by dpa, AP, and Reuters