Iran's president has called Tehran's decision to enrich uranium up to 60% after saboteurs attacked a nuclear site "an answer to your evilness", linking the incident to ongoing talks in Vienna over its tattered nuclear deal with world powers.
Israel, which has not commented on the attack, is suspected of carrying out the assault last weekend at the Natanz nuclear facility, part of a shadow war between the two countries.
The escalation in enrichment could see further retaliation as Israeli prime minister Benjamin Netanyahu has vowed never to allow Tehran to obtain a nuclear weapon.
His country has twice pre-emptively bombed nations in the Middle East to stop their atomic programmes.
Speaking to his cabinet, an impassioned Iranian president Hassan Rouhani said damaged first-generation IR-1 centrifuges at Natanz would be replaced by advanced IR-6 centrifuges which enrich uranium much faster.
"You wanted to make our hands empty during the talks, but our hands are full," Mr Rouhani said.
He added: "Sixty per cent enrichment is an answer to your evilness. We cut off both of your hands - one with IR-6 centrifuges, and another one with 60%."
On Tuesday, Iran announced it would enrich uranium to its highest level ever in response to the weekend attack at Natanz.
That also includes adding another 1,000 "more advanced" centrifuges.
Officials initially said the enrichment would begin on Wednesday.
However, an early Wednesday morning tweet from Iran's envoy to the International Atomic Energy Agency (IAEA), Kazem Gharibadadi, suggested this might come later.
He wrote the enrichment would be handled by only two cascades of IR-4 and IR-6 centrifuges at Natanz. A cascade is a group of centrifuges working together to enrich uranium more quickly.
"Modification of the process just started and we expect to accumulate the product next week," Mr Gharibadadi wrote.
Iran insists its nuclear programme is peaceful, though the West and the IAEA says Tehran had an organised military nuclear programme up until the end of 2003.
However, the nuclear deal prevented it from having enough of a uranium stockpile to be able to pursue a nuclear weapon.
An annual US intelligence report released on Tuesday maintained the American assessment that "Iran is not currently undertaking the key nuclear weapons-development activities that we judge would be necessary to produce a nuclear device".
The talks in Vienna are aimed at reviving America's role in that agreement, which former president Donald Trump abandoned, and lifting the sanctions he imposed.
Mr Rouhani in his comments on Wednesday insisted Iran still seeks a negotiated settlement in Vienna over its programme.
"The US should return to the same conditions of 2015 when we signed the nuclear deal," Mr Rouhani said.
Iran had previously said it could use uranium enriched up to 60% for nuclear-powered ships.
However, the Islamic Republic currently has no such ships in its navy. The IAEA has confirmed that Iran informed it of its plans to enrich up to 60%.
Iran had been enriching up to 20% - and even that was a short technical step to weapons-grade levels of 90%.
The weekend attack at Natanz was initially described as a blackout in the electrical grid feeding above-ground workshops and underground enrichment halls - but Iranian officials later began calling it an attack.
Alireza Zakani, the hard-line head of the Iranian parliament's research centre, referred to "several thousand centrifuges damaged and destroyed" in a state TV interview.
However, no other official has offered that figure and no images of the aftermath have been released.
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