The finding also calls into question a tentative new US plan meant to induce Tehran to compromise on its nuclear program by offering a rollback of crippling new anti-Iran sanctions if Tehran cuts back on enriching uranium to 20 percent.
In its report, the International Atomic Energy Agency said Iran was ready within days to ramp up its production of 20 percent enriched uranium at its plant at Fordo using 700 more centrifuges.
That would double Iran's present output and cut in half the time it would take to acquire enough of the substance needed to make a nuclear weapon, reducing it to just over three months.
Iran says it has no interest in making nuclear arms, just nuclear power for its citizens, but the United States and other nations believe otherwise. Iran has refused to give up enrichment despite international sanctions and offers of reactor fuel from abroad and for years has stalemated an IAEA probe of suspicions that it worked secretly on developing such arms.
The report urged Iran to stop stalling the IAEA probe, declaring that unless it starts to cooperate, the IAEA cannot "exclude the existence of possible military dimensions to Iran's nuclear program."
The report also clashed with comments by Israeli officials suggesting that Iran has slowed the timetable for reaching the ability to make nuclear weapons. The discrepancy is important because the earlier Israeli comments implied that Israel would have more time before deciding whether to hit Iranian facilities in an attempt to slow Tehran's perceived efforts to make nuclear weapons.
The IAEA report, which was circulated among the IAEA's 35 board member states, was obtained by The Associated Press. It said between the last IAEA board report in August and now, Iran had put nearly 700 centrifuges that were installed but not ready to operate at Fordo under a vacuum to make sure they are airtight.
That is the last step before uranium gas is fed into the centrifuges and the process or enrichment begins - an activity that can produce both reactor fuel or at high levels the fissile interior of a nuclear weapon. It takes only a few days to start enrichment with machines that are under vacuum.
The centrifuges, "having been subjected to vacuum testing, were ready for feeding" with uranium gas, the report said.
About 700 other centrifuges have already been producing 20 percent uranium at Fordo since early this year. Another 1,400 or so have been installed but are not yet believed operational - bringing the total to about 2,800 in all.
While experts agree that the Islamic Republic could assemble enough weapons-grade uranium to arm a nuclear weapon relatively quickly, they point out that this is only one of a series of steps need to create a working weapon. They say that Tehran is believed to be years away from mastering the technology to manufacture a fully operational warhead.
Earlier this month, Israeli Defense Minister Ehud Barak said Iran has "essentially delayed their arrival at the red line by eight months." That jibes with the timeframe laid out by Israeli Prime Minister Benjamin Netanyahu in September, when he spoke at the U.N. General Assembly. There, Netanyahu said the world has until next summer at the latest to stop Iran before it can build a nuclear bomb.
Iran has a far larger enrichment plant at Natanz, in central Iran, which churns out uranium enriched below 4 percent. But the 20 percent material being produced at Fordo is of greater concern to the international community because it can be turned into weapons-grade uranium of 90 percent purity much more simply and quickly - and because the facility, near the holy city of Qom, is well protected against attack.
Some 140 kilograms - about 300 pounds - of weapons-grade uranium is needed for at least one warhead.
Olli Heinonen, who headed the IAEA's Iran probe until 2010, said Tehran would likely be able to produce enough 20 percent enriched uranium by the summer to be able to make weapons-grade uranium for two or three warheads, if it doubles its Fordo capacity.
The report's other main area of concern focused on Parchin, a military site southeast of Tehran that the agency suspects was used for testing high explosives used to set off a nuclear charge - and which the IAEA fears is undergoing a major cleanup.
Iran has repeatedly turned down IAEA requests to visit the site, which, the report warned "seriously undermined" the IAEA's ability to conduct effective verification. The report cited satellite photos showing that Iran has torn down buildings, dug up a wide area around the suspect site and embarked on other suspect activities indicating sanitization attempts there.
In Washington, State Department spokeswoman Victoria Nuland would not comment on the IAEA report, but said the IAEA been calling on Iran to intensify efforts toward an agreement on its nuclear program for more than a year.
"That has not happened," she noted.