Iran's Cultural Heritage Organisation said in October it had set a two-month deadline for the British Museum to allow the public display in Iran of the so-called Cyrus Cylinder, linked to the Persian ruler's 6th century BC conquest of Babylon.
The museum, which houses a vast collection of world art and artefacts, said in September that plans to hand over the 2,500-year-old clay cylinder had been delayed due to unspecified "practicalities."
Hamid Baqaie, head of the state Cultural Heritage Organisation, said the museum had failed to meet the deadline, ISNA news agency reported. He said it had offered to deliver the cylinder by July instead but that this was not acceptable.
"The Cultural Heritage Organisation has cut all its relations and cooperation with the British Museum," he said, adding the move concerned archaeological, exhibition and research cooperation.
Iran is already at odds with Britain and other Western powers over the Islamic Republic's nuclear energy programme, which the West suspects is for military aims. Iran denies this, saying it aims solely to produce electricity.
Iranian officials have also accused London of interfering in Iran's internal affairs following the country's disputed presidential election last year, which plunged the major oil producer into political turmoil.
The Iranian government has warned of a possible downgrading of ties in different fields.
Cyrus is regarded as one of ancient Persia's greatest historical figures, creating one of the world's first empires two centuries before Alexander conquered the region.
He captured Babylon, in today's Iraq, in 539 B.C. and freed Jews held in captivity there. He is also credited as the author of a decree inscribed on the cylinder named after him, which some have described as the first charter of human rights.
(Reporting by Hossein Jaseb and Ramin Mostafavi; writing by Fredrik Dahl; editing by Andrew Roche)
