U.N. inspectors have found traces of highly enriched uranium on equipment from an Iranian research center linked to the military, diplomats said Friday, revelation likely to strengthen U.S. arguments that Tehran wants to develop nuclear arms.

Iranian President Mahmoud Ahmadinejad waves to journalists as he walks with Indonesian Minister of Research and Technology Kusmayanto Kadiman, left, after meeting with Indonesia's second largest Muslim organization Muhammadiyah in Jakarta, Indonesia, Friday, May 12, 2006. The Iranian president told a meeting of Indonesian Islamic leaders his country's nuclear program is for peaceful purposes, participants in discussion said. [AP]

The diplomats, who demanded anonymity in exchange for divulging the confidential information, cautioned that confirmation still had to come through other laboratory tests.

Initially, they said the density of enrichment appeared to be close to or above the level used to make nuclear warheads. But later a diplomat accredited to the International Atomic Energy Agency said it was below that, although higher than the low-enriched material used to generate power and heading toward weapons-grade level.

Still, they said, further analysis could show that the find matches others established to have come from abroad. The IAEA determined earlier traces of highly enriched uranium were imported on equipment from Pakistan that Iran bought on the black market during nearly two decades of clandestine activity.

Even then, nevertheless, the find would be significant.

Because Iran has previously denied conducting enrichment-related activities at the site, the mere fact the traces came from there bolsters arguments that it has hidden parts of a program that can create the fissile material used in nuclear warheads. Additionally, the site's connection to the military weakens Iranian arguments that its nuclear program is purely civilian.

"That has long been suspected as the site of undeclared enrichment research and ... the Iranians have denied that any enrichment research had taken place at that location," said Iran expert Gary Samore of the MacArthur Foundation in Chicago. "It certainly does reinforce the agency's suspicion that Iran has not fully declared its past enrichment research."

The development, however, was unlikely to result in an immediate American push for strong U.N. Security Council action against Tehran.

The Americans recently agreed to put such efforts on hold and give new European-led attempts to find a negotiated solution a chance in the face of fierce Russian and Chinese opposition to a strong signal from the council.

Moscow and Beijing have balked at British, French and U.S. efforts to put a Security Council resolution under Chapter 7 of the U.N. Charter. Such a move would declare Iran a threat to international peace and security and set the stage for further measures if Tehran refuses to suspend uranium enrichment. Those measures could range from breaking diplomatic relations to economic sanctions and military action.

Despite their declared support for the European effort to persuade Iran to give up enrichment, the Americans are ignoring calls for direct contacts with Iran ¡ª a stance criticized Friday by U.N. Secretary-General Kofi Annan.

Calling on "all sides to lower the rhetoric," Annan said Washington should "come to the table" and join the Europeans and Iranians.

Iran's president remained defiant. He accused the Americans of "waging a propaganda campaign" against his country. "The people of Iran and the country are not afraid of them," President Mahmoud Ahmadinejad told Islamic leaders in Indonesia.

On Saturday, Ahmadinejad reiterated that his aim was to generate energy, and that he would continue to fight for the right to develop new technologies. He spoke ahead of trade talks between the so-called Developing Eight nations.

Uranium enriched to between 3.5 percent and 5 percent is used to make fuel for reactors to generate electricity. It becomes suitable for use in nuclear weapons when enriched to more than 90 percent.

Iran denies it wants to make nuclear arms and says it is interested in uranium only to generate power. It already has enriched uranium to low levels ¡ª an accomplishment that opens the pathway to weapons-grade enrichment.

Diplomats accredited to the IAEA on Friday noted that Tehran's enrichment program has progressed faster than agency experts had expected. That also suggests Iran has hidden research and development from IAEA inspectors, they said.

To argue that it never produced highly enriched uranium domestically, Tehran cites the IAEA's tentative conclusion last year that traces collected from Iranian sites with no suspected ties to the military arrived on equipment from Pakistan.

But the origin of the samples now being studied created some concern in that regard.

One of the diplomats told The Associated Press that the samples came from vacuum pumps that has various applications, including use in uranium-enriching centrifuges at a former research center at Lavizan-Shian. The center is believed to have been the repository of equipment bought by the Iranian military that could be used in a nuclear weapons program.

The United States alleges Iran conducted high-explosive tests that could have a bearing on developing nuclear weapons at the site.

The State Department said in 2004 that Lavizan's buildings had been dismantled and topsoil removed to hide nuclear weapons-related experiments. The IAEA later confirmed the site had been razed.

In an April 28 report, IAEA head Mohamed ElBaradei said the agency took samples from some of the equipment of the former Physics Research Center at Lavizan-Shian.