© Getty A student surfing the internet in Tehran.
Reza Taghipour, the country's telecommunications minister, said the step was being taken because sensitive intelligence was vulnerable on the worldwide web, which he said was untrustworthy because it was controlled by "one or two" countries hostile to Iran.
"The establishment of the national intelligence network will create a situation where the precious intelligence of the country won't be accessible to these powers," Mr Taghipour told a conference on Sunday at Tehran's Amir Kabir University.
He described the move as the first phase of a project to replace the global internet with a domestic intranet system scheduled to be completed within 18 months.
Opponents have previously denounced the plan as a means of stamping out western influence on the internet while further tightening already stringent online surveillance of political activists and regime critics.
While Iranian officials have repeatedly spoken about creating their own alternative to the internet, the latest announcement follows the upheaval wreaked by Stuxnet and Flame, both of which are believed to have been developed jointly by the US and Israel.
Comment: What hope is there for a nation which designs laws and regulations to protect abuse and injustice? And what will the future hold for a world that does not denounce such psychopathic behavior? Reading the history of Nazism should make the answer rather obvious.