Iran has agreed to limit uranium enrichment and to open its nuclear programme to daily inspection by international experts starting next Monday.
It sets the clock running on a six-month deadline for a final nuclear agreement, officials said on Sunday.
In exchange, the Islamic Republic will get a relaxation of the financial sanctions that have been crippling its economy.
The announcement that Iran and six world powers had agreed on the plan for implementing an interim agreement came first from Iranian officials and was later confirmed elsewhere.
Some US politicians have been worried about the agreement, calling for tougher sanctions against Iran, rather than any loosening of controls.
Iran’s official IRNA news agency quoted Iranian deputy foreign minister Abbas Araghchi as saying the deal, which sets the terms of a landmark agreement reached in November, would take effect from next Monday.
The agency said Iran will grant the United Nations’ watchdog International Atomic Energy Agency access to its nuclear facilities and its centrifuge production lines to confirm it is complying with terms of the deal.
Mr Araghchi later told state television some $4.2bn (£2.5bn) in seized oil revenue would be released under the deal. Senior officials in President Barack Obama’s administration put the total relief figure at $7bn (£4.2bn).
Mr Obama welcomed the deal, saying it “will advance our goal of preventing Iran from obtaining a nuclear weapon”.
He said: “I have no illusions about how hard it will be to achieve this objective, but for the sake of our national security and the peace and security of the world, now is the time to give diplomacy a chance to succeed.”
Under the November agreement, Iran agreed to limit its uranium enrichment to five per cent – the grade commonly used to power reactors.
The deal also commits Iran to stop producing 20 per cent enriched uranium – which is only a technical step away from weapons-grade material – and to neutralise its 20 per cent stockpile over the six months.