Iran on Wednesday successfully tested a new locally built satellite rocket named Kavoshgar 3, state-media reported.
President Mahmoud Ahmadinejad also unveiled Wednesday the new domestically produced carrier engine Simorq, which can take a 100-kg satellite into orbit.
The event came on the 31st anniversary of the 1979 Islamic revolution.
"This is a great technological achievement for Iran as now we have the confidence that there is no limit to our technological capabilities," Ahmadinejad said at the ceremony in Tehran.
"As far as aerospace technology is concerned, we need two more steps and then we can claim that the space is in the hands of Iranian scientists," the president added.
The range of the new rocket is 500 km to place a satellite into orbit. Ahmadinejad said the range would be increased in coming years to as much as 1,000 km.
The rocket carried a mouse, a turtle and worms, and is supposed to transfer empirical data to earth.
Iran launched its first satellite into orbit in February 2009, propelled by the Safir 2 rocket. Wednesday, it unveiled three new communications satellites, named the Tolou, Mesbah 2 and Navid.
Tehran has rejected Western charges that the country's aerospace projects had any military aims. It accused western powers of trying to distort Iran's scientific achievements as aggressive.
The US and Israel said the same technology could be used to carry ballistic missiles, but Iran described the project as an "ultra-modern scientific achievement".