At least four student leaders have been arrested in Tehran the day after Iran's government ordered a halt to all student protests. Also on Tuesday, Iran's chief prosecutor said the death sentence against a history teacher, which triggered the protests, will stand unless the teacher agrees to appeal his case.
The political tension comes as reformist Iranian President Mohammad Khatami is trying to curb the influence of conservatives who control the judiciary, and many other aspects of life in Iran.
The arrests of the student leaders, reportedly by men in plain clothes, come with new developments in the case of the political reformer they took to the streets to support.
His name is Hasem Aghajari, a disabled veteran of Iran's eight-year-long war with Iraq who has campaigned for political reform. His political activity got him in trouble with the conservative Islamic clerics who hold power in the country. He was tried, convicted and sentenced to death for blasphemy for criticizing those clerics and the power they wield.
His conviction sent thousands into the streets in protest almost daily for several weeks. Iran's supreme leader Ayatollah Ali Khamenei ordered the public debate to end and said the judiciary should review the case. On Monday, Iran's judiciary confirmed it would do so, but on Tuesday the chief prosecutor announced the Aghajari case can only be reviewed if he files an appeal, something he has vowed not to do.
The case and the turmoil surrounding it have created what Iran analysts are calling a major political crisis.
The chief editor of the monthly magazine Iran Digest, Said Idriss, says no one should underestimate the seriousness of the situation because it threatens the political power structure in the country. Mr. Said said this crisis is a direct challenge to the expressed will of Ayatollah Khamenei, and the outcome is far from certain.
He said the fact the Ayatollah ordered a judicial review of the Aghajari case shows that even he is subject to pressure.
But Mr. Said added, the seemingly contradictory act of arresting the student protest leaders is proof that hardliners in Iran still have considerable influence.
Political Science Professor and Iran specialist Pakinam El-Sharkawy of Cairo University agrees. But she also believes the Iranian power structure is responding to popular pressure out of fear that basic revolutionary principles may be at risk.
"Now the system is facing a lot of critics that [it] is losing its base. The system is always trying to appear to be responding to popular demands and especially after the feeling of the popularity of the reformer camp, the conservative camp is trying not to be completely isolated from the people," Ms. El-Sharkawy said.
She also points out that while the reformers do have influence they are a mixed group. She says those in the street are demanding more change than moderate elements in the leadership, such as President Khatami, are willing to accept.
"They are less revolutionary. They want to make change gradually. They don't really seek some kind of confrontation with the conservatives. They try to find solutions to the conflict within the system itself [and] not in a way that threatens the system they work in," he said.
The Aghajari case is at the center of the crisis, but the protest movement is also about broader issues. Protesters are also calling for the release of political prisoners and they are demanding greater freedoms, including more freedom of speech.
The confrontation between their desires for a more liberal Iran and the will of the hard-line Islamic clerics is still to be resolved.