Although Tehran is cooperating with U.N. regulators, it is still expanding its uranium enrichment program against international rules, the agency reported, according to the Associated Press.
While touting the importance of the cooperation, IAEA Deputy Director General Olli Heinonen said Iran still must fulfill its commitments of presenting information about its past nuclear activities by year's end.
The U.S. State Department, however, downplayed the significance of the findings.
"There is no partial credit here. I don't see anything, at this point, in this report, that changes the basic facts. ... Iran has refused to comply with its international obligations, and, as a result of that, the international community is going to continue to ratchet up the pressure," State Department spokesman Tom Casey told the AP.
But Iran used the IAEA report as evidence that U.S. calls for more sanctions against the country were baseless.
Mohammad Saeedi, deputy head of Iran's Atomic Energy Organization, told the Iranian state news service that the report cleared Iran's stance that it is not developing nuclear weapons. "This report ended all the baseless U.S. accusations against Iran," he said.
The United States and its allies are concerned that Iran's quest to develop a plutonium reactor and a uranium enrichment program would allow the Islamic state to develop a nuclear weapon.
The report noted, however, that while Iran has expanded its effort to enrich uranium, the process was going slowly and was not close to producing enough nuclear fuel to construct a bomb, the AP reported.
The IAEA report and a plan for cooperating with Iran will be discussed by the IAEA board starting Sept. 10.