In the worst concerted period of pollution for three years, primary schools and nurseries were closed and new car exclusion zones imposed in the capital.
Tehran's air quality index averaged 159 on Wednesday, up two from the previous day, and more than three times the World Health Organization's maximum advised level of between zero and 50.
One area in northeastern Tehran peaked at 238.
The official IRNA news agency reported that it was the 18th straight day of dangerously bad air while newspapers quoted officials casting blame on each other for the problem and failure to tackle it.
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The cold weather is causing climate inversion -- where emissions from car exhausts hang in the air rather than rising into the atmosphere above.
A decade-long central restriction zone based on car number plates was in place across the city on Wednesday, traffic police announced.
Vehicles with plates ending in an odd number can't go out on Saturday, Monday and Wednesday, while cars with even numbered plates are banned on Sunday, Tuesday and Thursday.
All outdoor sport activities are banned, he added, including professional football league matches.
Exhaust fumes from the five million cars and almost as many motorcycles that ply Tehran's roads account for 80 percent of its pollution, officials say.
Two permanent zones of traffic restrictions introduced in 1979 and 2005 have failed to rectify Tehran's poor air quality.
While Tehran is the epicentre the pollution also closed primary schools in other major cities including Isfahan, Qom, Arak and Tabriz.
Weather forecasters predicted that air quality would improve after expected rainfall on Wednesday evening.
In 2012, pollution contributed to the premature deaths of 4,500 people in Tehran and about 80,000 in the country, the health ministry said.