Relations between the United States and Iran changed dramatically between 1977 and 1979, as the two close allies turned into sworn enemies. This study seeks to explore the development of Washington s policy towards Iran during these years. Its analysis will begin at the very start of Jimmy Carter s presidency, at a time when the long-lasting de facto alliance between the two countries still stood strong. It will conclude with the hostage crisis of November 1979, which represents a clear watershed in the history of US-Iranian relations. The study sheds light on three interlinked questions: What were the primary interests of the Carter Administration in Iran? How did the US Government attempt to further these interests during this period, and why? What factors in the US policy towards Iran contributed to Washington s difficulties in protecting its interests there? Extensive amounts of recently declassified primary source material have been used to help explore these questions.