On February 3rd, using a modified Shahab 4 ballistic missile, Iran put a crude satellite into low earth orbit. This was done to coincide with the 30th anniversary of their Islamic revolution. The satellite was described as a "communications satellite", but it was actually nothing more than a transponder, giving off a signal that could be tracked. What Iran has done is carry out the same kind of early satellite launches Russia and the United States did in the 1950s. Iran says it is building four more satellites, but given the level of technology they have access to, these will be low capability birds, launched in to low orbit and have short lifetimes.
The Iranian launch is similar to the Russian Sputnik launch of 1957, which was the first satellite ever put in orbit. The U.S. followed in 1958. Since then, eight other nations, including Iran, have done the same. Ukraine was the last to do so, in 1995. Israel launched its first satellite in 1988. France launched its first satellite in 1965, Japan and China in 1970, Britain in 1971, and India in 1980.
For five years there have been reports of a longer range Shahab 4, based on Soviet-era SS-9 ICBM and North Korean No-Dong 2 missiles, under development. This rocket was also large enough to put a satellite into orbit. Iran claims that Shahab 4 has a range of 2,000 kilometers. Former Soviet and Chinese rocket engineers are alleged to have helped the Iranians design this missile, and adapt it serve as a satellite launcher.
Iran began working on the Shahab 4 twelve years ago, and it appears that they tried to launch a satellite last year, but it failed to achieve orbit. Two years ago, it tested the Shahab 4 as a satellite launcher, without attempting to actually orbit a satellite. The key to putting a satellite in orbit is the third stage, which contains the satellite and small maneuvering rockets and a computer to align and launch the satellite at the right time, speed and altitude to achieve orbit.