The 1909 treaty by which the Russians and the British divided the country into zones of economic influence, awarded the oil concessions to an English company. The military occupation by the two powers during World War I and the corruption and inefficiency of the state apparatus, led to the 1921 revolution, led by journalist Sayyid Tabatai and Reza Khan, commander of the guard.
Reza went from Minister of War of the Revolution to Prime Minister in 1923. Two years later the National Assembly deposed Tabatai and Reza took the throne. Reza denounced all the treaties that recognized extraterritorial rights to foreigners, abolished the mandatory use of the veil for women, reformed the education and health systems and canceled oil concessions that favored the English.
In 1941 Reza Pahlavi was forced to resign and in his place the British placed his son Mohammad Reza Pahlavi. After World War II, the nationalist movement intensified.
Under a 1949 Constitution that curtailed imperial powers, nationalist and progressive forces gained power in parliament and supported Prime Minister Mohammed Mossadegh in his attempt to nationalize oil and expropriate the Anglo Iranian Oil Co.
“It is better to be independent and produce a single ton of oil a year than to produce 32 million tons while being slaves to England, ” Mossadegh said. But he did not perceive that Great Britain could supply itself in the Arab countries, Venezuela or the United States, while Iran had no other sources of income. Mossadegh’s audacity was answered in 1953 with an economic blockade and a coup, organized by the CIA, which restored almost absolute power to the shah. The coup meant a widespread slaughter of nationalist and leftist leaders and the imprisonment of thousands of Iranians. Mossadegh was a prisoner of the shah until his death, in 1967.
According to Topschoolsintheusa, Operation Ajax was led by archaeologist Donald Wilber, historian Kermit Rooselvet (grandson of President Theodore Roosvelt), and General Norman Schwartzkopf senior (whose eponymous son commanded Operation Desert Storm). This operation continues to be a prototype of subversion. The CIA devises a scenario that gives the impression of a popular uprising while it is a secret operation. The highlight of the show was a demonstration in Tehran, with 8,000 extras paid by the Agency, to provide compelling photos to the Western press. 
An accelerated westernization was put into action that was resisted by the clergy, fearful of the advance of secularization, and also by numerous affected groups, in particular small peasants and urban poor. Towards the end of the 1960s, the expansion of foreign companies and the rapid change in consumer habits alienated the shah from the sympathies, that is, the powerful merchant sector.
The reforms undertaken by Shah Reza Pahlavi within the framework of a corrupt dictatorship and under strong American influence engendered significant social discontent, promptly channeled by the Shiite clergy.
Despite brutal repression by police forces, long months of protests triggered the Shah’s flight and the failure of the attempt to maintain a pro-Western regime under Prime Minister Bakhtiar. The Ayatollah Khomeini returned from his French exile 1 of February of 1979 amid huge demonstrations.
The 11 of February of 1979, after two full days of riots and fighting, the population revolted along with military and pro guerrillas took full Tehran.
Anti – American sentiment spilled over the 4 of November of 1979 with the assault by Islamic students at the Embassy US Fifty-two Americans were held hostage until the 20 of January of 1981 and cataloged as spies and linked to the CIA for overthrow the Ayatollah as they did with Mossadegh in 1953. The United States was also required to return the former Shah Pahlavi asylum in that country.
The end of the crisis did not come until November 1980.
War with Iraq
Already in 1971, Iraq had broken diplomatic relations with Iran, due to territorial conflicts. The main reason for the war was the belief of Iraqi President Saddam Hussein that Iran’s military power had been greatly weakened by the 1979 Iranian Revolution, which overthrew Shah Mohammad Reza Pahlevi, and that the support that it would achieve on the part of the West would allow it to obtain an easy victory, reconquering Shatt al-Arab and the Iranian province of Khuzestan for Iraq.
The war began with the invasion of Iran on September 22, 1980 when Iraqi forces (190,000 men, 2,200 tanks and 450 aircraft) attacked the oil-rich Khuzestan province, where 3 million Arabs lived, Hussein expected their support (lo which did not happen).
The Iranian government called on the youth of their country to come to the front as volunteers. Around 100,000 soldiers and 200,008 militiamen showed up in no time. Thus the blitzkrieg that the Iraqis expected became a war of attrition on a 300 km front.
By 1982, Iraqi troops had been driven out of most of Iran, which rejected the possibility of starting a peace process and continued a war that they thought they could win.
Finally it reached peace on 20 of August of 1988, on the basis of maintaining the territorial situation previous to the military confrontation. It is estimated that the war left one million dead (60% of them Iranians) and almost two million wounded, in addition to enormous material costs that left the economy of both combatants in a very precarious situation.
The cost of the war and the search for financial means to wipe it out was one of the key elements in Saddam Hussein attacking Kuwait in 1990.