Warnings of the dire consequences of military confrontation with Iran, and calls for a renewed diplomatic effort, are being issued on both sides of the Atlantic in a sign of the growing anxiety over the prospect of US or Israeli action.

A coalition of foreign policy thinktanks, humanitarian organisations and peace groups will issue a report today arguing that an attack on Iran, reportedly being contemplated by the US and Israel as a means of slowing down Iran's nuclear programme, would backfire disastrously.

 Sir Richard Dalton, Britain's former ambassador to Tehran, backed the report's conclusions. "Diplomacy has not been exhausted," he said. "Military action should be a last resort, used in self-defence against an imminent threat, and we have not reached that position yet."

Three former high-ranking US officers echoed the report's conclusions and urged Tony Blair to slow the march to war by making it clear to Washington that he would oppose a military attack on Iran.

In a letter in yesterday's Sunday Times, the retired officers - General Joseph Hoar, a former head of US central command, Lieutenant General Robert Gard and Vice Admiral Jack Shanahan - said a strike against Iran "would have disastrous consequences for security in the region, coalition forces in Iraq and would further exacerbate regional and global tensions".

The warnings come against a background of rising tension, with a new US determination to combat what Washington sees as covert Iranian support for insurgents and militias in Iraq, and with steadily growing confrontation over Iran's nuclear ambitions. In little more than two weeks a UN deadline expires for Iran to stop enrichment of uranium, which could trigger international sanctions. But there were reports over the weekend that Iran could be accelerating work on a uranium enrichment plant in Natanz.

The government of Mahmoud Ahmadinejad insists that it is seeking only to process uranium for power generation, but the International Atomic Energy Agency has criticised Iran for a lack of transparency over its programme, while the US and its allies suspect the Iranian leadership is using an ostensibly civil programme as a front for developing nuclear weapons.

British officials are concerned that hawks are winning the debate in Washington with claims that the only way to hinder Iran's development of nuclear arms is to launch air strikes against suspected weapons development sites.

But today's report, Time to talk - the case for diplomatic solutions on Iran, sponsored by the Oxford Research Group, the Foreign Policy Centre and Oxfam among others, argues that military action would have far-reaching negative consequences.

The authors say it would strengthen Iranian nuclear ambitions, create even greater instability in the region, especially Iraq and Afghanistan, further inflame the "war on terror", and exacerbate insecurity over energy supplies, damaging the global economy. They say it could cause long-term environmental damage by releasing radioactive material into the atmosphere, and cause significant civilian casualties.

The report argues there is still a lot of room for diplomacy, particularly bilateral discussions between Washington and Tehran. The Bush administration has repeatedly said it will only hold such talks once the Iranian government has agreed to stop uranium enrichment.

Its authors say that Iranian security concerns should be taken into account in comprehensive negotiations. "The idea of a 'Grand Bargain' should not be dismissed outright. Real diplomatic options still exist, if a face-saving solution can be found to convince the protagonists to approach the table," the report states.

"The possible consequence of military action could be so serious that governments have a responsibility to ensure that all diplomatic options have been exhausted. At present, this is not the case."

US supporters of a tough line towards Tehran argue that the repercussions from air strikes are being exaggerated and that those who play up their negative consequences are undermining western leverage on Iran. Sir Richard Dalton responded: "This is not taking the military option off the table ... But I think military action should be a last resort. Meanwhile, there is time for diplomacy."

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