Relations between Switzerland and Iran go back to the 17th century, when Swiss clockmakers settled in the Persian Empire. Economic ties expanded in the 19th century, especially in the transport and banking sectors. Swiss archaeologists also participated in excavations in Persia. The two countries signed a goodwill and trade agreement in 1873 and a goodwill agreement and an agreement on establishment in 1934. Iranians began coming to Switzerland in the 20th century: as tourists, refugees or students, such as former Prime Minister Mossadegh and Shah Muhammad Reza Pahlavi.

Switzerland opened a consulate in Teheran in 1919 (which it raised to embassy status in 1936). Because of its political neutrality, Switzerland has also represented the interests of a number of countries in Iran – including Italy (1946), Australia, Canada, Great Britain, Ireland and New Zealand (1952), South Africa (1952, 1979-1995) and Lebanon (1984). In addition, it has represented Iran's interests in relations with the Axis powers (1941-1946), in Israel (1958-1987), in Iraq (1971-1973) and in South Africa (1979-1994). Switzerland has represented the consular and diplomatic interests of the United States in Iran since 1980 and the interests of Iran in Egypt since 1979.

Iran and Switzerland have good bilateral relations. There are agreements between the two countries on air traffic (1954, 1972 and 2004), road and rail transport (1977), export risk guarantees (1966), protection of investments (1998) and double taxation (2002).

Beginning in 1984, victims of the Iran-Iraq War received medical treatment in Switzerland. After the severe earthquakes of 1997 and 2003, Switzerland helped to rebuild the infrastructure. Cooperation on the national level to prevent natural catastrophes was initiated in 2006. The two countries have been engaged in a human rights dialogue since 2003 and in discussions on migration since 2005.