Some 3,000 protesters, many of them heeding a call from U.S.-based Iranian exile satellite channels, took part in the demonstration which began as a smaller, student protest against privatising universities.
The last big demonstration took place late last year, and the satellite channels' past appeals for protests had been largely ignored. Residents said the chants at the demonstration were the most extreme since unrest four years ago.
"Political prisoners must be freed," the crowd shouted in a square near Tehran University, the scene nearly four years ago of the biggest pro-reform unrest since the 1979 Islamic revolution.
Several motorcycles were torched and windows of some shops and a state bank were smashed as protesters dispersed. Uniformed and plainclothes police with batons broke up the protest without major clashes. A handful of people were arrested.
Many in Iran have lost faith in moderate President Mohammad Khatami (news - web sites) and his lack of progress in reforming the 24-year-old Islamic Republic in the face of strong opposition from conservatives in powerful positions.
Analysts predicted more unrest in the run-up to the anniversary of the 1999 student riots early next month.
"There is enormous political and social pressure on the Iranian society, so such protests are normal and inevitable," said one political analyst who declined to be identified. "We can expect more of such protests in the future."
"I heard the students had gathered from television," said 46-year-old housewife Parvin. "I came here to send a message to (U.S. Secretary of State) Colin Powell (news - web sites) that we want change."
CHANGE FROM WITHIN
Powell told CNN on Sunday that Washington was working to persuade Iranians to force change from within to make Iran what he called a less troublesome member of the world community.
Iran's Foreign Minister Kamal Kharrazi rejected the remarks.
"Powell should know U.S. interference would boost resolve and solidarity among Iranians," newspapers on Wednesday quoted Kharrazi as saying.
The United States, which cut ties with Tehran after the 1979 revolution, has branded Iran part of an "axis of evil".
High unemployment and frustration with Iran's strict Islamic laws have fed discontent among the overwhelmingly youthful population, around 70 percent of which is under 30 and has little memory of life before the revolution.
Analysts say the reformers have been further weakened by a resurgent hardline faction which is determined not to loosen its grip on power now that U.S. troops are on both the eastern and western borders of Iran, in Afghanistan (news - web sites) and Iraq (news - web sites).
Despite the reformers' overwhelming victories in presidential and parliamentary polls since Khatami came to office in 1997, most of their efforts to institute change have been blocked by conservatives appointed as political watchdogs.
Dozens of pro-reform intellectuals, journalists and student leaders have been jailed as part of a conservative crackdown that followed the 1999 student protests.
