White House spokesman Robert Gibbs reiterated US warnings of "consequences" if Iran continues to develop uranium enrichment capabilities.
Recent pronouncements by Iranian leaders showed "they have no interest in building international confidence that their nuclear program is for peaceful means," he added.
Tehran said Monday it was considering building two more uranium enrichment plants inside mountains to protect them from air strikes.
But it followed that with a letter to the International Atomic Energy Agency on Tuesday saying it was prepared to buy fuel for a nuclear reactor or swap its own stockpile of low-enriched uranium for the fuel, but on its own territory.
The West has offered to make such a trade only outside Iran.
State Department spokesman Philip Crowley said the latest Iranian proposal was "unacceptable."
"We will continue to work within the IAEA and also consult from the international standpoint on appropriate next steps, including the prospect of sanctions," Crowley said.
