Best Buy Co. will start selling the iPhone on Sept. 7, becoming first U.S. chain to do so outside of Apple Inc.'s and AT&T Inc.'s own stores.

Wednesday's announcement by Best Buy expands the availability of Apple's vaunted phone to 970 full-size stores and 16 smaller Best Buy Mobile stores.

It's also a coup for the Minneapolis-based chain, which has been upgrading its cell-phone departments.

"We had a lot of work to do, obviously, to get in a position where Apple and AT&T would feel good about Best Buy Mobile carrying it, and that's what we've done in the last 18 months," said Shawn Score, president of Best Buy Mobile.

• Click here for FOXNews.com's Personal Technology Center.

Best Buy also resells Apple's Mac computers and iPod media players. Apple spokeswoman Natalie Kerris said the long-standing relationship between the companies was the reason Best Buy would now be able to sell the iPhone.

Last week, Best Buy announced it had completed a two-year conversion of its stores to include upgraded cell-phone departments under the Best Buy Mobile brand.

It has upgraded its computer systems to handle cell-phone activation and spent 250,000 hours training its employees.

Score said Best Buy Mobile, which resells phone service under the carriers' brands, now has a 3.6 percent share of the cell-phone market, up from 2 percent last year.

It is a joint venture with CarPhone Warehouse Group PLC, which sells the iPhone in Britain and is Europe's largest cell-phone retailer.

In Europe, independent chains like CarPhone have a much stronger presence, while the U.S. market is dominated by the carriers' own stores.

AT&T, the exclusive U.S. carrier for the iPhone, sells it in more than 2,000 stores. Apple has 189 U.S. stores.

Another major electronics chain, RadioShack Corp., sells AT&T phones, but not the iPhone. AT&T spokesman Michael Coe said he could not speculate on whether the iPhone would be sold at other third-party retailers.

"Smart" phones like the iPhone, which does e-mail, Web surfing, and accept third-party software, are a big focus for Best Buy Mobile. Sales are up tenfold in two years, Score said.

It is the only authorized third-party reseller of Sprint Nextel Corp.'s iPhone-like Samsung Instinct.

"The smart phones are what people are heading for," Score said.

Apple launched the second generation of the iPhone on July 11. The two models cost $199 and $299 with two-year contracts.