Swedish authorities said on Tuesday that Iran hacked into a text messaging service last year and sent thousands of messages urging Swedes to take revenge against Quran burners.
In 2023, individuals in Sweden on several occasions set fire to Islam's holy book in public, prompting outrage in the Muslim world and raising fears of attacks by jihadists.
"The security police are able to establish that a cyber group acted on behalf of the Iranian Revolutionary Guard to carry out an influence campaign," the Swedish Security Service said in a statement.
"The purpose was, among other things, to paint the image of Sweden as an Islamophobic country and create division in society," it said.
Sweden last year raised its terrorism alert following the Quran burnings.
"That a state actor, in this case Iran, according to the security police's assessment, is behind an act that aims to destabilize Sweden or increase polarization in our country is of course very serious," Justice Minister Gunnar Strommer told Reuters.
'Only poison the relations'
Iran's embassy in Stockholm rejected the accusation, according to the Iranian Students News Agency (ISNA), saying: "We expect Swedish authorities to curb this scheme against Iran ...especially since the Swedish judiciary issued a rightful decision to prosecute those who desecrated the Holy Quran."
"The publication of these claims in the media will only poison the relations between the two countries," the embassy added.
In a separate statement, the Swedish Prosecution Authority said the investigation showed it was Iran's Islamic Revolutionary Guard Corps that carried out the data breach.
It said it had identified the individual hackers carrying out the breach but would not press charges because it was unlikely to achieve a prosecution abroad or extradition of individuals to Sweden.
Swedish prosecutors said in August they would put two men on trial for setting fire to the Quran in a series of incidents last year that prompted outrage in the Muslim world and raised fears of retaliatory attacks by jihadists.