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In the 1960s, years before Shah Reza Pahlavi was overthrown in Iran, college-educated children of Iranian merchants formed the Mujahideen-e-Khalq (MEK), also known as the Muslim Iranian Student's Society, National Liberation Army of Iran (NLA), National Council of Resistance (NCR), and People's Mujahideen of Iran (PMOI). With an ideological blend of Marxism and Islam, the MEK originally sought to work against Western cultural and economic influences that the group's founders felt pervaded their country. After the revolution of 1979, the MEK developed into Iran's largest and most active armed dissident group, opposing the mullahs’ control of the country.

Although the U.S. State Department has declared the MEK to be a terrorist organization, others consider it to be a grassroots movement opposing a tyrannical theocracy. The MEK was also described at one time as a group of stooges for Saddam Hussein's military government in Iraq, where its organization of several thousand fighters was based.

During the 1970s, the MEK worked to overthrow the Shah and his backers. The group engaged in terror attacks against Western interests in Iran, killing several U.S. military personnel and civilians; the group also supported the takeover of the U.S. embassy in Tehran in 1979. After the Shah fled in January 1979 and Ayatollah Ruhollah Khomeini returned from French exile during the Islamic revolution, the MEK fought against the ayatollah's supporters in street battles in an enduring struggle for power over governmental control.

During the 1980s, Iranian security forces persecuted the MEK's leaders and forced them to flee to France. MEK members and other dissidents were killed or abducted, and many were tortured; at one point the MEK accused the government of holding up to 140,000 political prisoners. By 1987 most MEK leaders had resettled in Iraq, where the group remained until the U.S. invasion in 2003. According to the U.S. State Department, the MEK was largely supported by Iraq during that period, and it fought on the Iraqi side in the 1980–1988 Iran-Iraq War. The group also depended on front organizations to raise donations from expatriate Iranians.

In the 1990s the MEK carried out and claimed responsibility for a number of attacks in Iran, including a bombing in a Tehran public building that killed two children. In April 1992, in a large-scale attack, the MEK targeted Iranian embassies in 13 different countries. When the U.S. State Department first designated the armed wing of the MEK, the National Liberation Army, a terrorist organization in 1997, more than 100 members of Congress signed a statement criticizing the administration of President Bill Clinton, claiming that the administration was labeling a group of freedom fighters as terrorists. In 1998 a member of the MEK tried to gain access to a United Nations meeting attended by world leaders, including President Clinton and President Mohammad Khatami of Iran. He was foiled by a routine screening of his application.

In February 2000 the group claimed that it had launched over 12 attacks against Iran, as part of what it called Operation Great Bahman. Later that year, the MEK regularly accepted responsibility for mortar attacks and hit-and-run raids along the Iraq-Iran border; these attacks targeted Iranian military, police, and government units. It also accepted responsibility for six mortar attacks on government and military buildings in Tehran.

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