Speaking to reporters at the State Department, Clinton said it is clear that administration efforts to engage Iran in talks to restrain its nuclear program in 2009 fell short. President Obama had said that if Iran did not respond positively to his overtures by the start of 2010 he would move toward tougher sanctions.
Clinton said the administration is consulting with other nations about new sanctions, but she stressed that this does not mean the administration is abandoning its effort to start a dialogue with Iran.
There is no hard-and-fast deadline for Iran to respond, she said.
"We've avoided using the term `deadline' ourselves," she said. "That's not a term we have used because we want to keep the door to dialogue open. But we've also made it clear we can't continue to wait and we cannot continue to stand by when the Iranians themselves talk about increasing their production of highly enriched uranium" and taking other steps toward possible production of nuclear weapons.
Iran denies that its nuclear program is intended to make a nuclear bomb.
At the White House, deputy press secretary Bill Burton echoed Clinton's remarks, saying, "The door is of course still open for Iran to do the right thing and live up to its international obligations."
He said the administration will "be going through the appropriate process to try to get them to the table."
Burton said presidential aides will meet this week to discuss next steps on Iran policy.
Clinton declined to discuss any details of prospective new sanctions against Iran.
"I can't appropriately comment on the details of those discussions now, except to say that our goal is to pressure the Iranian government, particularly the Revolutionary Guard elements, without contributing to the suffering of the ordinary Iraqis, who deserve better than what they currently are receiving."
Clinton also said the administration is appalled by Iranian government crackdowns on street protests.
The opposition movement began as a raw and angry voter backlash after last June's disputed presidential election, but has evolved into a possibly deeper and more ingrained fight against Iran's Islamic leaders.
At least eight people died in clashes between security forces and opposition supporters across Iran late last month, including a nephew of opposition leader Mir Hossein Mousavi. It was the worst bloodshed since the height of the unrest immediately after the June re-election of President Mahmoud Ahmadinejad.
"We are deeply disturbed by the mounting signs of ruthless repression that they are exercising against those who assemble and express viewpoints that are at variance with what the leadership of Iran wants to hear," Clinton said.