A group of demonstrators stormed the compound of the British Embassy in Iran, the Foreign Office confirmed.
A spokesman said: "A group of demonstrators have trespassed in the British Embassy compound in north Tehran.
"The situation has been resolved. All of our staff are safe and have been accounted for."
He could not confirm reports from the IRNA news agency that the demonstrators were students protesting against what they see as British support for Israel's air strikes on Gaza or that the students tore down the British flag and hoisted a Palestinian standard in its place.
The incident happened at 5.20pm GMT (8.50pm local time) and reports claimed that the occupation lasted about an hour.
No one at the embassy was available for comment.
Foreign Secretary David Miliband was last night in crisis talks with European Union counterparts after a fourth day of Israeli airstrikes in Gaza.
He has insisted any ceasefire had to ensure Israel's security and reinforce the position of elected Palestinian leader Mahmoud Abbas.Reuse content