This document outlines the political turmoil in Iran in the 1970s and 1980s and Iranian-U.S. relations during this period. Chapter 1 outlines the Shah Reza Pahlavi's concern over U.S. President Jimmy Carter's election, the beginnings of the Islamic religious revival, and U.S. Secretary of State Cyrus Vance's visit to Iran in May 1977. Chapter 2 describes events leading up to the 1979 Iranian revolution, the abdication of the Shah, Ayatollah Ruhollah Khomeini's assent to power, U.S. diplomats' visits to Iran, and the various errors committed by the Carter administration. Political instability, violence, and terrorism are the focus of chapter 3, and the rule of the moderates (1979-81), the assassination of the political elites, the planned destruction of the Tudeh Party, Khomeini's political strategies, and major U.S. political errors are described. The hostage crisis and the 1980 abortive U.S. rescue mission are presented in chapter 4. Chapter 5 describes the Iran-Iraq War, early U.S. support of Iraq, the arms movement between the United States and Iran, and the role of Israel in the arms' negotiations. The book concludes that the Iranian hostage crisis will continue to shape future U.S. policy towards Iran. Questions for classroom discussion and a 13-item reading list are included. (DJC)