Iran's hardline president says a U.S.-born journalist in jail for espionage should have the right to a full appeal, a sign the Islamic Republic wants to continue a fledgling dialogue with the new Obama administration.
The surprising move came as U.S. officials said Iran could gain diplomatic points with Washington if it responds to the case positively.
On Sunday, U.S. President Barack Obama said he was "gravely concerned" about Roxana Saberi, who was convicted of spying on Iran last week amid international concern about human rights and freedom of expression in the country.
"She is an Iranian-American who was interested in the country which her family came from. And it is appropriate for her to be treated as such and to be released," Obama said.
The case had threatened to derail historic efforts between Iran and the U.S. to establish diplomatic relations after 30 years of hostility.
Earlier on Sunday, Iranian President Mahmoud Ahmadinejad wrote a letter to Tehran's top prosecutor and asked that "suspects be given all their rights to defend themselves," according to the state-run media agency IRNA.
"Prepare for the court proceedings ... to observe and apply justice precisely," Ahmadinejad added.
Saberi was reportedly tried, convicted and sentenced during a one-day hearing that occurred behind closed doors. The writer and former Miss North Dakota beauty pageant winner was also tricked into incriminating herself by Iranian officials, her father has said.
Saberi was first arrested in January on charges that she was working without proper press credentials. However, an Iranian judge later upped those charges to espionage -- a charge that can carry a death sentence in some cases.
Complicating the case, Saberi reportedly told her father that she was arrested after purchasing a bottle a wine. Saberi, a freelance journalist who has worked for the British Broadcasting Corporation and National Public Radio, moved to Iran six years ago to write and research a book.
The case is the latest in a series of crackdowns on journalists and free expression in Iran and follows the death of Canadian-Iranian photojournalist Zahra Kazemi in 2003.
Kazemi died while in the custody of Iranian penal officials.
Meanwhile, Ahmadinejad's letter to the prosecutor also made reference to Canadian-Iranian blogger Hossein Derakhshan, who has was jailed in November for allegedly insulting religious figures, IRNA reported.
Ahmadinejad wrote that Derakhshan also be give the chance to fully defend himself in court.
Some commentators have said the latest arrest is an attempt by conservative factions within Iran's judiciary to derail any chance of diplomacy with the U.S.
Conversely, analyst Saeed Leilaz said the entire affair could be a ruse to gain leverage with the U.S.
"Iran can use Saberi's case as a bargaining card in possible negotiations with the U.S.," Leilaz told The Associated Press.
