The rally comes just days before Tuesday's US presidential election
Thousands of Iranians chanting "Death to America" burnt US flags on Friday to mark the 33rd anniversary of the seizure of the US embassy in Tehran, just days before the American presidential election.
The demonstrators also chanted anti-British and anti-Israeli slogans, and burnt Israeli flags, in front of the site of the former embassy, dubbed the "den of spies" by the authorities who sponsor the annual commemoration, an AFP photographer reported.
This year's rally came just days before Tuesday's US presidential election in which Republican challenger Mitt Romney has made Iran's controversial nuclear programme a top foreign policy issue.
"The greatest threat the world faces is a nuclear Iran," Romney said in a campaign debate with Democratic incumbent Barack Obama.
Iran dismisses Western suspicions that its nuclear programme is cover for a drive for a weapons capability, insisting that it is for peaceful power generation and medical purposes only.
The United Nations, the United States and the European Union have levied a series of sanctions on Iran to stop its atomic programme.
Speaking at Friday's rally, the commander of Iran's volunteer Islamist Basij militia, Brigadier General Mohammad Reza Naqdi, said the Islamic republic will face the sanctions head on.
"The Iranian nation has chosen its path and will overcome the sanctions by adopting the 'economy of resistance'," he said, referring to supreme leader Ayatollah Ali Khamenei's policy of confronting the punitive measures.
After long denying the impact of these measures, Iranian leaders are now beginning to acknowledge the extent of the damage and denouncing what they say is an "economic war" against the Islamic republic.
"Those who say that by compromising with the US, the economic situation will improve... (should know that) this is a big lie and deceit," Naqdi said.
"We have declared a 10 kilo (22 pounds) in gold reward for researchers and historians, who have 10 years to prove that there is a more criminal country than America in the world... the US is the most hated among all nations."
The anniversary of the November 4, 1979 embassy seizure, in which Islamist students captured and held 52 US diplomats hostage for 444 days, is commemorated in Iran according to the Persian calendar.
The hostage-taking, which came just months after the Islamic revolution overthrew the US-backed shah, was seen as a big factor in then US president Jimmy Carter's loss of the 1980 election.
Now painted with anti-US murals, the former embassy is currently a training and educational facility controlled by Iran's elite Revolutionary Guards.