The fifth daylight attack on technical experts in two years, the magnetic bomb delivered a targeted blast to the door of 32-year-old Mostafa Ahmadi-Roshan's silver sedan as he was driven down a busy street near a Tehran university during the morning rush hour. The chemical engineer's driver also died, Iranian media said, and a passer-by was slightly hurt.
Israel, whose military chief said on Tuesday that Iran could expect to suffer more mysterious mishaps, declined comment. The White House, struggling for Chinese and Russian help on economic sanctions, denied any U.S. role and condemned the attack.
While Israeli or Western involvement seemed eminently plausible to independent analysts, a role for local Iranian factions or other regional interests engaged in a deadly shadow war of bluff and sabotage could not be ruled out.
The killing, which left debris hanging in trees and body parts on the road, came in a week of heightened tension:
Iran has started an underground uranium enrichment plant and sentenced an American to death for spying; Washington and Europe have stepped up efforts to cripple Iran's oil exports for its refusal to halt work that the West says betrays an ambition to build nuclear weapons. Iran says its aims are entirely peaceful.
Tehran has threatened to choke the West's supply of Gulf oil if its exports are hit by sanctions, drawing a U.S. warning that its navy was ready to open fire to prevent any blockade of the strategic Strait of Hormuz, through which 35 percent of the world's seaborne traded oil passes.
U.S. Secretary of State Hillary Clinton said Iran's threats to close the strait were "provocative and dangerous" and repeated the White House denial of any U.S. involvement in the killing of Ahmadi-Roshan.
Analysts saw the latest assassination, which would have taken no little expertise, as less a reaction to recent events than part of a longer-running, covert effort to thwart Iran's nuclear development program that has also included suspected computer viruses and mystery explosions.
While fears of war have forced up oil prices, the region has seen periods of saber-rattling and limited bloodshed before without reaching all-out conflict. But a willingness in Israel, which sees an imminent Iranian atom bomb as a threat to its existence, to attack Iranian nuclear sites, with or without U.S. backing, has heightened the sense that a crisis is coming.
The Atomic Energy Organisation of Iran, which has failed to persuade the West that its quest for nuclear power has no hidden military goal, said the killing of Ahmadi-Roshan would not deter it: "We will continue our path without any doubt ... Our path is irreversible," it said in a statement carried on television.
"The heinous acts of America and the criminal Zionist regime will not disrupt our glorious path ... The more you kill us, the more our nation will awake."
First Vice-President Mohammad Reza Rahimi, quoted by IRNA news agency, said: "Iran's enemies should know they cannot prevent Iran's progress by carrying out such terrorist acts."
Iran's leaders, preparing for the first national election since a disputed presidential vote in 2009 brought street protests against 32 years of clerical rule, are struggling to contain internal tensions. Defiance of Israel and Western powers plays well with many who will vote in March.
In Washington, White House spokesman Tommy Vietor said: "The United States had absolutely(...)More.