The Ministry of Defence has said that "all options should be kept on the table" amid reports the department is stepping up its contingency planning for a potential military strike against the country's nuclear facilities.
The Guardian reported that British armed forces have been ratcheting-up contingency plans in response to a new aggressiveness in Iranian foreign policy, and the belief that the US may decide to launch targeted missile strikes against Iranian facilities.
There is mounting concern that Tehran's nuclear enrichment programme has regained some of its former strength, and that within a year it may be impossible for the US or other forces to cripple it from the outside.
In a separate development on Wednesday, Israel test-fired a missile capable of reaching Iran, amid rumours that Prime Minister Benjamin Netanyahu and Defence Minister Ehud Barak are pushing to gain cabinet consensus for a pre-emptive strike on nuclear sites in the Islamic Republic.
A report by the UN's nuclear watchdog, the International Atomic Energy Agency (IAEA), is due next week and looks set to deliver new evidence of Iran's weapons programme.
The latest of a series of quarterly reports on the subject, it is anticipated that the report could be "a game-changer" for diplomatic negotiations on Iran.
"It is going to be hard for even Moscow or Beijing to downplay its significance," the Guardian quoted a senior official as saying.
Despite grave concerns inside the coalition with regard to an attack on Iran, the MoD is now examining where British military assets may be best deployed during a potential conflict.
The MoD told the Huffington Post UK on Wednesday that the government is still committed to negotiation, but did not rule out the possibility of military action.
"The British Government believes that a dual track strategy of pressure and engagement is the best approach to address the threat from Iran’s nuclear programme and avoid regional conflict," the MoD said in a statement.
"We want a negotiated solution - but all options should be kept on the table."
The Guardian said Iran was again becoming a focus for military planners, according to a number of top Whitehall and defence officials.
One senior Whitehall official told the newspaper that the regime had proved "surprisingly resilient" and appeared to be "newly aggressive – and we are not quite sure why".
The official cited three recent assassination plots that it believes were co-ordinated in Tehran.