The official IRNA news agency, quoting a Lorestan medical official, said 988 were injured in the quake of 6.0 magnitude in mostly rural Lorestan province, west of the capital Tehran.
Some survivors were dug out of the rubble of buildings alive. But the death toll was expected to rise, the head of the disaster control committee in the Lorestan governor's office, told Reuters.
''We cannot predict the number of those killed,'' Ali Barani said by phone from Lorestan. ''We are digging out the victims.'' Iranian television showed brick houses flattened, with bent iron girders poking out, and mud buildings reduced to mounds of dust. An earth mover lifted broken masonry from one building, while residents scrabbled through rubble with their bare hands.
Barani said 330 villages in the area were severely damaged.
But strong tremors on Thursday night might have helped keep the toll down because many had left their homes and taken to the streets well before the big earthquake hit today morning.
Television pictures from the area showed families in the cold morning air huddled around fires next to their wrecked homes. Officials said telephone lines, electricity and gas supplies had been cut.
Hospitals were full in Doroud and Boroujerd, the two main cities near the epicentre, state radio reported. Lorestan Governor-General Mohammad Reza Mohseni-Sani appealed for aid from neighbouring areas, radio said.
U.S. AID OFFER President Mahmoud Ahmadinejad ordered emergency aid sent to the quake zone, IRNA said. It included sniffer dogs to search for survivors and two helicopters, state television said.
The United States, which has had no diplomatic ties with Iran since U.S. diplomats were held hostage in Tehran after the 1979 Islamic revolution, also offered humanitarian assistance.
''If you remember, the United States extended earthquake assistance to Iran at the time of the Bam earthquake and I am quite certain we would be more than prepared to do the same,'' U.S. Secretary of State Condoleezza Rice said in Britain.
The 2003 earthquake in Bam, 1,000 km southeast of the capital, killed about 31,000.
In Geneva, the International Federation of Red Cross and Red Crescent Societies, using information from the Iranian Red Crescent, said rescue teams had been mobilised.
There are no major oil facilities in the area. Iran is crisscrossed with seismic faultlines. The worst recorded earthquake was in 1990, when a 7.7 quake in the northeast killed 35,000 people.
REUTERS SY HS1629