Canada is shutting its embassy in Tehran and severing diplomatic relations with Iran, Foreign Affairs Minister John Baird has said.
He said the Canadian embassy in Tehran will close immediately and Iranian diplomats in Canada have been given five days to leave.
Mr Baird, who serves in a Conservative government that is a staunch ally of Israel, said Iran is the most significant threat to global peace and security in the world today.
"The Iranian regime is providing increasing military assistance to the Assad regime; it refuses to comply with UN resolutions pertaining to its nuclear programme; it routinely threatens the existence of Israel and engages in racist anti-Semitic rhetoric and incitement to genocide," Mr Baird said in a statement.
"It is among the world's worst violators of human rights; and it shelters and materially supports terrorist groups, requiring the Government of Canada to formally list Iran as a state sponsor of terrorism under the Justice for Victims of Terrorism Act."