Updated

U.N. inspectors have found traces of highly enriched, weapons-grade uranium at an Iranian nuclear facility, a senior diplomat said Tuesday, citing a report by the International Atomic Energy Agency (search).

The find heightened concerns that Tehran may be running a secret nuclear weapons program.

Agency inspectors found "particles" of highly enriched uranium that could be used in a weapons program at the facility at Natanz, said the diplomat, who covers the activities of the U.N. nuclear watchdog and spoke on condition of anonymity.

The United States has accused Iran of developing a clandestine nuclear weapons program, violating the Nuclear Nonproliferation Treaty (search) barring the spread of atomic weapons.

Iran has denied the allegations, insisting its programs are devoted only to generating electricity.

Iranian officials did not contest the finding by the IAEA inspectors but said the equipment was already contaminated by traces of enriched uranium when purchased by Tehran (search).

The diplomat said the report, prepared for a meeting of the U.N. agency's board, underlined the need for further inspections of the Natanz facility and Iran's nuclear programs in general to abolish concerns about the nature of its activities.

"It says that contamination is a possibility," as Iran claims, he said. "But there is work to be done to determine the plausibility of this."