Reformers in the Islamic Republic said the awarding of the prize to lawyer and rights activist Ebadi was a victory for women's rights and political change in Iran.
"In the name of the Islamic Republic of Iran's government I congratulate Dr Ebadi and we see this (award) as the result of her qualifications," Abd Allah Ramazanzadeh, spokesman for Iran's reformist government said in the first official reaction.
He said her views on human rights, especially women's rights, had been noted internationally and "this is an honour for Iranian women and shows that Iranian Muslim women have gained a positive atmosphere for their activities and we hope that her views will be noticed inside and outside of Iran."
In a show of support by the reform government of President Muhammad Khatami, Ramazanzadeh said a government representative would attend a welcoming ceremony for Ebadi at Tehran airport on her return to the country on Tuesday.
Conservative-controlled state television and radio took several hours to announce Ebadi's award, then did so without comment, reflecting the struggle with reformists over Iran's political destiny.
Vice President Muhammad Ali Abtahi, a close aide to Khatami, said the announcement was "very good news for every Iranian" and a sign of the active role played by Iranian women in politics.
He stressed the comments reflected his personal view.
But individual conservatives, who have long viewed Ebadi's activities as a defender of women's rights and lawyer for political dissidents as a threat to the Islamic system, reacted angrily to the Nobel Committee's decision.
"We have to congratulate the Iranian nation, particularly women, on her success and consider it a success for all of those who are attempting to improve human rights and remove oppression throughout the world"
Leading reformist parliamentarian
"Although we may be happy that an Iranian has won the prize we believe the Nobel Peace Prize is being used to suit political objectives," said Amir Mohebian, an editor of the hardline conservative Resalat newspaper.
"This prize carries the message that Europe intends to put further pressure on human rights issues in Iran as a political move to achieve its particular objectives," he said.
Since coming to office in a 1997 landslide, Khatami's government has struggled to break the stranglehold on power enjoyed by unelected conservatives opposed to any watering down of what they say are Islamic principles.
Over the past four years scores of liberal newspapers have been shut down and dozens of pro-reform activists jailed by the hardline judiciary. Ebadi herself has been briefly jailed and was banned from practising law for five years in 2000.
Struggle for democracy
International criticism of Iran's human rights record has met with stern rebukes for other nations not to interfere in Iran's internal affairs.
Leading reformist parliamentarian Elahe Koulaei said Ebadi's award was a sign the Nobel Committee had recognised the importance of the struggle for greater democracy in Iran.
"We have to congratulate the Iranian nation, particularly women, on her success and consider it a success for all of those who are attempting to improve human rights and remove oppression throughout the world," she said.