"As we did not receive the EU proposal, naturally we will definitely resume work at the Isfahan plant tomorrow," a senior Iranian nuclear official told Reuters on condition of anonymity.
The move has raised the stakes in the nuclear standoff and Iran risks being hauled before the UN Security Council for possible sanctions, a persistent demand of the United States, which accuses Tehran of seeking atomic weapons.
On Saturday Iran set a Monday deadline for EU negotiators -Britain, France and Germany - to offer a package of trade, technology and security incentives in return for Iran guaranteeing its nuclear programme is peaceful.
But London denied there was a deadline.
The Europeans had previously said they intended to submit the proposals after new President Mahmoud Ahmadinejad takes office on 3 August.
Iran says its activities make fuel
for civilian nuclear power plants
"The negotiations continue. We will not resume enrichment, we are today waiting until 5:00 pm (1230 GMT) for the European proposals," Mohammadi said.
"The only thing that we will resume, if the European proposals do not take into account the least of our demands, is part of the activities at Isfahan."
Conversion, a process carried out in Iran at a facility in the central city of Isfahan, changes uranium ore into uranium gas that is the feedstock for enrichment.
Right to enrichment
Iran agreed in November to suspend uranium enrichment activities - a process that makes fuel for civilian nuclear power plants, but can also be the explosive core of atom bombs - during negotiations with the Europeans.
Tehran says it has the right to enrichment under the nuclear Non-Proliferation Treaty (NPT) and the issue has been one of the chief stumbling blocks in the process with the Europeans.
Outgoing President Mohammad Khatami said last week that Iran would resume enrichment activities no matter what the Europeans propose, although "we prefer to do it with their agreement".
"The only thing that we will resume, if the European proposals do not take into account the least of our demands, is part of the activities at Isfahan"
Ali Agha Mohammadi,
Washington accuses its arch enemy of seeking nuclear weapons, a charge vehemently denied by the Islamic republic, and the negotiation process with the EU is aimed at avoiding Tehran being brought before the Security Council.
But the EU Three is "warning about the consequences of breaking the suspension and that this will lead to the matter being taken to the UN Security Council," one diplomat told AFP in Vienna, the headquarters of the International Atomic Energy Agency.
Time limit passed
Iranian Foreign Ministry spokesman Hamid Reza Asefi said Iran would inform the UN nuclear watchdog on Sunday or Monday of the resumption of some conversion work.
"The time limit (on the suspension of such activities) has passed and public opinion cannot wait any longer," Asefi said.
Hamid Reza Asefi: Public opinion
cannot wait any longer
He said international inspectors in Iran would be taken to the Isfahan facility where the IAEA seals would be "removed in the presence of the inspectors and the work will resume".
On Saturday, Mohammadi had said that a deadline of 1 August had been fixed at a meeting in London and if the Europeans did not stick to this then Iran would take "measures in line with its national interest".
However, a spokesman for the British Foreign Office denied that there was ever a deadline.
"An exact date hasn't been fixed," said the spokesman, adding the parties were only following a general guideline of late July or early August.