TEHERAN - THOUSANDS of Iranians chanted 'Death to America' as they staged a mass protest on Thursday against the 'Great Satan' to mark the 31st anniversary of the capture of the US embassy by Islamist students.

But Teheran also welcomed a US decision to list shadowy rebel group Jundallah as a foreign terrorist organisation, saying it was the 'right' move, while reiterating its allegation that Washington supports the Sunni network.

Iran annually on Nov 4 marks the anniversary of the seizure of the US embassy by students in Tehran in 1979, just months after the Islamic revolution toppled the US-backed shah. The embassy has remained shuttered and the US and Iran have since had no diplomatic ties.

On Thursday, waving Iranian flags and carrying anti-US banners alongside posters of Iran's supreme leader Ayatollah Ali Khamenei, the largely young crowd also shouted anti-Israel slogans outside the US embassy site.

Banners saying 'I will give my life for the leader (Khamenei)' and another quoting Iran's revolutionary leader Ayatollah Ruhollah Khomeini as saying 'If you want to shout, shout at the US' were displayed at the embassy compound.

The students, who took 52 American diplomats hostage for 444 days, said they were responding to Washington's refusal to hand over the deposed shah, Mohammad Reza Pahlavi.

Protest against 'Great Satan' US