Pro-government militia members fired on Iranian protesters during a massive demonstration over the country's hotly-disputed election, killing at least one person and wounding several others.
An Associated Press photographer saw one person shot dead and several others who appeared seriously wounded in Tehran's Azadi, or freedom, Square. The shooting came from a compound for volunteer militia linked to Iran's powerful Revolutionary Guard.
Residents reported hearing gunfire in three districts of northern Tehran, Reuters reported.
Tens of thousands of Iranians took to the streets of Tehran Monday, defying a country-wide crackdown with protests against the of last week's presidential election, which declared Mahmoud Ahmadinejad the winner.
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Chanting crowds, some wearing green campaign colors, greeted Mir Hossein Mousavi, the defeated candidate in Friday's election, as he slowly moved through the streets on the back of a car.
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Security forces watched quietly with shields and batons at their sides.
Later, a group of demonstrators with fuel canisters set a small fire at the compound of a volunteer militia linked to Iran's powerful Revolutionary Guard as the crowd dispersed from the square. As some tried to storm the building, people on the roof could be seen firing directly at the demonstrators at the northern edge of the square, away from the heart of the rally.
"There has been sporadic shooting out there... I can see people running here," a reporter from Iran's English-language Press TV told Reuters.
Click here for a video report on the gunfire from Sky News.
Both Mousavi and Mehdi Karroubi, another defeated candidate who appeared alongside him Monday, have lodged complaints that the vote was rigged.
Some of the results — which awarded a record-breaking 25 million votes and 63 percent of the electorate to Ahmadinejad — were announced before the ballot boxes had even been opened.
State Department spokesman Ian Kelly told reporters Monday that the United States is concerned about allegations of ballot fraud.
Kelly described the U.S. government as "deeply troubled" by the events in Iran, taking a stronger stance than Vice President Biden did Sunday, casting doubt on the legitimacy of the election.
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When pressed by a reporter, Kelly declined to condemn Iranian security forces for their crackdown on street protesters. He said the U.S. knows too little about the conduct of the election to say for sure whether there was fraud.
The chanting demonstrators had defied an Interior Ministry ban and streamed into central Tehran — an outpouring for Mousavi that swelled as more poured from buildings and side streets.
The crowd — many wearing the trademark green color of Mousavi's campaign — was more than five miles long, and based on previous demonstrations in the square and surrounding streets, its size was estimated to be in the hundreds of thousands.
"I am ready to pay any price to materialize the ideals of you dear people," Mousavi said, speaking though a portable loudspeaker. "People feel their wisdom has been insulted. We have to pursue legal channels to regain our trampled rights and stop this last lie, and stand up to fraud and this astonishing charade."
Mousavi, wearing a gray striped shirt, said his solution was "canceling the result of this disputed election."
"This will have the least cost for our nation. Otherwise, nothing will remain of people's trust in the government and ruling system."
The crowd roared back: "Long live Mousavi."
One placard said, in English: "This is not election. This is selection." Other marchers held signs proclaiming "We want our vote!" and they raised their fingers in a V-for-victory salute.
"We want our president, not the one who was forced on us," said 28-year-old Sara, who gave only her first name because she feared reprisal from authorities.
Also on Monday, Iran's Supreme Leader Ayatollah Ali Khamenei ordered an investigation into allegations of election fraud, marking a stunning turnaround by the country's most powerful figure and offering hope to opposition forces who have waged street clashes to protest Ahmadinejad's re-election.
The decision came after Mousavi wrote a letter appealing to the Guardian Council and met Sunday with Khamenei, who holds almost limitless power over Iranian affairs. Such an election probe by the 12-member council is uncharted territory and it was not immediately clear how it would proceed nor how long it would take.
Election results must be authorized by the council, composed of clerics closely allied with the unelected supreme leader. All three of Ahmadinejad's challengers in the election — Mousavi and two others — have made public allegations of fraud after results showed the president winning by a 2-to-1 margin.
"Issues must be pursued through a legal channel," state TV quoted Khamenei as saying. The supreme leader said he has "insisted that the Guardian Council carefully probe this letter."
Click here for more on this story and a video report from the Times of London.
The Times of London and The Associated Press contributed to this report.
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