At least 500 people were killed when an earthquake measuring 6.4 on the Richter scale struck near Zarand in central Iran on Tuesday.
Around 500 were injured, Iranian officials told state-run television.
In Zarand, a city of about 135,000 people in Kerman province, 20 people died and 280 were hospitalised, officials said.
Six of Zarand's outlying villages suffered damage, the state-run television was told.
Casualties are expected to rise as rescue workers reach the area, where heavy rain is hampering rescue work.
According to a CNN report, the US Geological Survey said the quake was centred about 56 km northwest of Kerman at a depth of about 41 km.
Zarand, is about 200 km from Bam, where a 6.6-magnitude quake on December 26, 2003, killed more than 30,000 people. That quake was closer to the surface, at a depth of 10 km.
A deeper earthquake allows "more time for the energy to dissipate, and that means less intense shaking (on the surface)", CNN quoted a USGS official as saying.
