"Within 18 months Iran will launch its own satellite. Iran will be the first Islamic country to enter the stratosphere with its own satellite and its own, indigenous launch system," Defence Minister Ali Shamkhani was quoted as saying.
"The aerospace capacity of the Islamic republic is one of the main means of deterrence for the country, and is acquired through cooperation between the defence industries and universities," he added.
The minister did not say what type of satellite would be launched.
"There was a time when the Persian Gulf was a source of threats against the Islamic republic, but today with the power we have obtained this region can no longer be used against us by any non-regional power," IRNA quoted him as saying.
Shamkhani's comments are believed to be the first time a senior Iranian official has put a timescale on the country's space programme, and his comments could spark fresh alarm over the extent of the Islamic republic's ballistic missile capability.
Tehran finalised its testing of the Shahab-3 missile in June 2003. The missile is thought to be capable of carrying a 1,000 kilogramme (one-tonne) warhead at least 1,300 kilometers (800 miles) -- therefore bringing arch-enemy Israel within range.
Six Shahab-3 missiles were paraded in Tehran in September during the festivities marking the outbreak of the 1980-88 Iran-Iraq war, and one of them carried a banner declaring "We will wipe Israel from the map".
The Shahab-3 is believed to be derived from technology acquired from North Korea and Pakistan.
But the defence ministry has since moved to allay international fears by asserting it intends to tweak the Shahab-3 and not develop longer-range missiles for military purposes.