Known as Persia until 1935, Iran became an Islamic republic in 1979 after the ruling shah was forced into exile. Conservative clerical forces established a theocratic system of government with ultimate political authority vested in a learned religious scholar. A group of Iranian students seized the US Embassy in Tehran on 4 November 1979 and held it until 20 January 1981. During 1980-88, Iran fought a bloody, indecisive war with Iraq over disputed territory. Over the past decade, popular dissatisfaction with the government, driven by demographic changes, restrictive social policies, and poor economic conditions, has created a powerful and enduring pressure for political reform.