Iran has pledged to suspend uranium enrichment and accept closer inspection of its nuclear facilities.
The breakthrough follows high-level talks in Tehran between senior Iranian officials and the Foreign Ministers of France, Britain, and Germany.
Iran's agreement to halt uranium enrichment and submit to tougher U.N. inspections of its nuclear facilities were key demands of the three European powers. In exchange, the Europeans are reportedly offering nuclear technical cooperation to Iran.
The International Atomic Energy Agency has given Iran until the end of October to prove its nuclear program does not include bomb-making, a charge made by the United States.
After initial talks with the European ministers, Iranian Foreign Minister Kamal Kharrazi maintained Iran is not pursuing, what he called, an illegal program.
His British counterpart, Jack Straw, said the European ministers respected the rights of any sovereign nation to have a civil nuclear program, but not to be involved in proliferation activities.