All 17 alleged spies were Iranian nationals, the director of the counter-espionage of the Islamic Republic intelligence ministry said at a press conference. The name of the director was not disclosed.
Those arrested worked as staff at sensitive centers in the country, including “economic, nuclear, infrastructural, military and cyber fields or their counterpart private sector," according to the Iranian intelligence press release.
Some of the spies who declined to cooperate with the Islamic Republic intelligence after their arrest have been sent to the judiciary and their cases are being processed. Their sentences will be either execution or a long imprisonment, the intelligence director said.
However, those spies who decided to "honestly cooperate" with the Islamic Republic's intelligence organization were used to work "against Americans,” Iran said.
President Donald Trump dismissed the allegations as "totally false" and "lies and propaganda."
The president later addressed the controversy in the Oval Office.
“I read a report today about CIA,” Trump told reporters before a meeting with Pakistani Prime Minister Imran Khan. “That's totally a false story. That's another lie. They put out propaganda, they put out lies.”
Trump also said Iran’s behavior was making it more difficult for him to “make a deal with Iran” and that, at this point, he’d be “OK either way it goes” with Iran.
“If they want to make a deal, it’s—frankly it’s getting harder for me to want to make a deal with Iran because they behave very badly,” Trump said. “They're saying bad things. And I'll tell you, it could go either way – very easily. Very easily. And I'm okay either way it goes.”
Secretary of State Mike Pompeo told Fox Business prior to Trump's comments: "I would urge everyone who's reading that story waking up to understand that the Iranian regime has a long history of lying. ... I would take with a significant grain of salt any Iranian assertion about any actions that they've taken."
The assigned mission of the arrested spies was allegedly "collecting classified information" or acting in "technical operations," the counter-espionage director said.
He added all of the spies were arrested before they managed to accomplish their mission.
According to the Iranian intelligence director, defendants serving their sentences have mentioned "tempting" promises by the CIA, including U.S. visas and residency, a proper job in America or even the promise of medical aid abroad for themselves or loved ones suffering from illnesses.
The arrests come against the backdrop of heightened tensions with Iran, including the seizure of foreign tankers near the Strait of Hormuz, the downing of unmanned drones by both sides and the country's alleged increased attempts to develop nuclear weapons.
The intelligence ministry director later clarified to ABC News that the new arrests are different from the former case of dismantling a CIA spy ring in 2011.
“That case is now closed and the new arrests are for the mission conducted in 2017-2018," the director said. More than a dozen spies working for the CIA had been arrested in that mission.
Iran also said it has provided its “allied countries” with intelligence clues of the current case including "CIA officers' information, clues and intelligence techniques used by the network" in order to create "another global failure" for the CIA.
ABC News' Ben Gittleson contributed to this report.