President-elect Barack Obama said he expected to "move swiftly" to engage Iran, whose nuclear quest he said would be one of his administration's biggest challenges.
"I think that Iran is going to be one of our biggest challenges," he said in an ABC News interview broadcast Sunday, warning a nuclear-armed Iran "could potentially trigger a nuclear arms race in the Middle East."
Obama promised "a new emphasis on respect and a new emphasis on being willing to talk, but also a clarity about what our bottom lines are."
"And we are in preparations for that. We anticipate that we're going to have to move swiftly in that area."
Former US defense secretary William Perry predicted Thursday that Obama would likely face a "serious crisis" over Iran's nuclear ambitions in his first year in office.
The Islamic republic has defied UN sanctions designed to halt its enrichment of uranium, insisting that its nuclear program is for civilian energy needs and has no military bent.
Obama said he would also confront Iran about its "exporting terrorism through Hamas, through Hezbollah."
"And we are going to have to take a new approach. And I've outlined my belief that engagement is the place to start. That the international community is going to be taking cues from us in how we want to approach Iran," he said.
Obama said his administration would be "sending a signal that we respect the aspirations of the Iranian people," but would also make clear that it has "certain expectations in terms of how a international actor behaves."