Iran says its activities are peaceful and has refused to halt the work.
Tehran says wants nuclear technology so it can make fuel for a planned network of nuclear power plants, allowing it to save its huge oil and gas reserves for export.
France and Britain have submitted a third resolution against Iran calling for measures that include asset freezes and mandatory travel bans for specific Iranian officials.
It also expands the list of Iranian officials and companies targeted by the sanctions.
Earlier sanctions were imposed in December 2006 and March 2007.
Though it agreed on the outline of the sanctions resolution last month in Berlin, some Western diplomats had expressed concern Russia might try to weaken the resolution out of pique over the recognition of Kosovo.
In Vienna, the chief US envoy to the International Atomic Energy Agency, the UN nuclear watchdog, said Iran’s dismissal of intelligence indicating it tested technology relevant to nuclear bombs could trigger a resolution by its governors to put further pressure on Iran.
Gregory Schulte said: “We haven’t made a decision on a resolution, but it could be an effective way to convey this message.”
Iran says the intelligence, which came mainly from a laptop spirited out of Iran in 2004 and handed to Washington, is baseless and fabricated.