Iran's decision shortens that diplomatic opening.
In declining the deal Wednesday, Iran said it would consider other options for its uranium stockpile – provided it remained in the country – and called for a return to talks.
But Secretary of State Hillary Rodham Clinton recently said the deal had already been negotiated and could not be reopened or amended.
That approach drew a sharp reaction from Iranian Foreign Minister Manouchehr Mottaki, who told an Iranian news service, "Diplomacy is not black or white. Pressuring Iran to accept what they [in Washington] want is a non-diplomatic approach."
But Iran's decision appeared to leave no option to the Obama administration but to proceed to the "consequences" that Secretary Clinton has repeatedly said a rejection would prompt.
In Washington, members of Congress and Iran analysts who have been dubious about the prospects for engagement with Iran were quick to call for sanctions.
"The idea that somehow we could bring the Iranians into submission through dialogue or let somebody else pressure them, I believe that game should now be over," says Henry Sokolski, executive director of the Nonproliferation Policy Education Center in Washington.
It will be a challenge for the US to get other world powers to go along with toughened sanctions on Iran. Both Russia and China, important commercial partners of Tehran, hold veto power in the UN Security Council and could nix any sanctions resolution. But Mr. Sokolski says it is "certain," on the other hand, that nothing will happen without Washington.