The Iranian government said it will permanently suspend Google Inc's e-mail service in the country, the Wall Street Journal reported its website Wednesday.
The report comes as Iran braces for new opposition protests on Thursday during rallies marking the 1979 Islamic revolution. Protesters made use of modern networking tools such as Twitter and Gmail instant messaging last June after a disputed election plunged Iran into crisis.
Google is already at loggerheads with China's government after it threatened to withdraw from the country last month over claims of online attacks and issues over censorship.
Iran's telecommunications agency announced the suspension and said a national e-mail service for Iranian citizens would soon be rolled out, the Wall Street Journal reported.
The Journal said it was not yet clear what effect the move has had on Google's Gmail service in Iran.
There was no immediate comment from Tehran, where it was after midnight when the news broke. Opposition leaders have called on supporters to take to the streets Thursday, raising the risk of renewed violence.
Google did not immediately respond to a request for comment.
The U.S. State Department could not confirm the report, but said any efforts to keep information from Iranians would fail.
"While information technologies are enabling people around the world to communicate ... like never before, the Iranian government seems determined to deny its citizens access to information, the ability to express themselves freely, network and share ideas," State Department spokesman P.J. Crowley said.
"Virtual walls won't work in the 21st century any better than physical walls worked in the 20th century."