As a signatory to the Non-Proliferation Treaty, Iran is prohibited from developing a nuclear weapons program. While Iran acknowledges having a nuclear program, it says it is used for peaceful purposes. The international community is not so sure. In November, the International Atomic Energy Agency (the IAEA) reached an agreement with Iran to suspend its uranium enrichment program and allow inspections to verify that it does. Correspondent Laurie Kassman reports from Washington the international community is divided over how to deal with Iran if it does not.

IAEA spokeswoman Melissa Fleming says measures are in place to help verify Iran's compliance with the suspension arrangement, including seals on equipment and remote cameras.

"Inspectors will visit frequently to make sure the seals have not been tampered with. We can see if we have cameras on the equipment. We can actually watch it from here in Vienna so we would know if there is any activity involving uranium enrichment there."

Uranium enrichment is not the only cause for concern. Ms. Fleming says Iran's secret nuclear program for more than a decade has left many unanswered questions.

"One, there was contamination found with particles of highly enriched uranium and some low enriched uranium. In any case, there's a mystery there and it has to be solved. There are also questions surrounding Iran's development of a certain type of cenrifuge P-2. There's a lapse of time when they say there was no activity and we're trying to verify that. These are some examples."

Questions have also been raised about Iran's development of long-range missiles capable of carrying nuclear weapons.

For Middle East expert Larry Diamond of Stanford University's Hoover Institution, thorough inspections of Iran's nuclear programs are a key element in curbing Iran's potential for building nuclear weapons.

"The byword that should guide us is in the old line between (President) Reagan and (Russian President) Gorbachev: Trust but verify. I think experts on nuclear proliferation believe if there is extremely comprehensive and unhindered inspections with lots of people, we can pretty much hold the Islamic Republic to this agreement."

Iran's nuclear ambitions are not new. Shah Reza Pahlevi had talked of building his country's nuclear capabilities well before he was ousted by the Islamic Revolution in 1979.

In an interview on CNN's Late Edition, former National Security Advisor Zbigniew Brzezinski points to Iran 's location in a volatile region, well within range of several nuclear-capable countries.

"They have security problems, real security problems -- around them Pakistan, which is unstable, India, Russia and Israel have nuclear weapons."

Former chief United Nations weapons inspector David Kay says that sense of vulnerability in part motivates Iran to seek nuclear deterrence.

"The Iranians, I think, view a nuclear weapon as part of an overall security strategy. That's what makes it very difficult to see how you reasonably close down that program unless you address the Iranian concerns about their own national security."

Iranians argue that pursuing full nuclear capability is a right and, to some degree, a necessity. They point to the U.S.-led wars in neighboring Iraq and Afghanistan to bolster their position.

President Bush does not hide his distrust of Iran. In 2001, he declared Iran part of what he called an "axis of evil," along with two other states seeking nuclear capabilities -- Iraq and North Korea.

Mr. Bush says Iran's agreement to suspend nuclear activities is not enough.

"The Iranians agreed to suspend but not terminate their nuclear weapons program. Our position is they ought to terminate their nuclear weapons program."

The Bush administration has threatened to lobby the U.N. Security Council to take action against Iran if it violates the latest IAEA agreement.

European governments prefer using better trade ties as a bargaining chip to dissuade Iran from building nuclear weapons.

Analyst Larry Diamond favors a mix of both. He says European governments can be tougher when negotiating trade agreements and the Bush administration should find ways to support moderate voices within Iran's divided leadership.

"The U.S. has a number of carrots to deploy that we haven't and I think we should if the Iranians cooperate and become more responsible. The Europeans have a number of sticks to deploy if the Iranians reject or violate it in some way."

The possibility of Iran possessing nuclear weapons and the missiles to deliver them has raised concerns across the Middle East.

Former National Security Adviser Brent Scowcroft told CNN's Late Edition any strategy used to dissuade Iran will have implications far beyond the region.

"It's not Iran itself. But if Iran gets away with enriching uranium, Brazil already has announced it wants to enrich uranium. And pretty soon you'll have every medium-sized country in the world producing the capability for nuclear weapons."

Concerns over Iran's nuclear ambitions have intensified because of the war on terrorism.

Security experts favor mixing promises of better relations and threats of tough sanctions to persuade the leadership in Tehran they will pay the price for pursuing a weapons program. But the analysts caution that taking too inflexible a position could backfire and provoke hard-liners in Tehran's political circles to stir up troubles in neighboring Iraq or farther afield.