The Trump administration is to reinstate all US sanctions on Iran removed under the 2015 nuclear deal. The White House said it was the toughest sanctions regime ever imposed on Iran and targeted Iran's energy, shipping and banking sectors.
However, eight countries will not be penalized by the US for continuing to import Iranian oil. EU states which backed the deal have said they will protect EU firms doing legitimate business with Iran.
President Donald Trump withdrew from the deal in May, describing it as defective at its core. Sanctions are coming, he tweeted after Friday's announcement, referencing the TV series Game of Thrones and its motto Winter is coming.
The US has been gradually re-imposing sanctions since it unilaterally withdrew from the agreement, but analysts say this move is the most important because it targets the core sectors of Iran's economy.
An Iranian foreign ministry spokesman said Iran was unconcerned at the return of sanctions. The agreement saw Iran limit its controversial nuclear activities in exchange for sanctions relief. Barack Obama, the US president at the time, had argued the deal would prevent Iran from developing nuclear arms.
The UK, France, Germany, Russia and China were also parties to the 2015 accord and have stuck to it, saying they will set up a new payment system to maintain business with Iran and bypass US sanctions.
Mr Trump argues that the terms of the deal are unacceptable and it has not stopped Iran developing a ballistic missile program and intervening in neighboring countries, including Syria and Yemen.
Iran has accused Mr. Trump of waging psychological warfare.
The US sanctions will come back into force on Monday 5 November, covering shipping, shipbuilding, finance and energy.
The names of more than 700 individuals, entities, vessels and aircraft will be put on the sanctions list, including major banks, oil exporters and shipping companies. They are the second lot of sanctions re-imposed by Trump since May.
US Secretary of State Mike Pompeo said the sanctions were aimed at fundamentally altering the behavior of Iran.
He set out 12 demands that Iran must meet in order to have the sanctions lifted. These include ending support for terrorism and military intervention in Syria, as well as completely halting nuclear and ballistic missile development.