In an appearance before a Senate Appropriations panel, Clinton reiterated that the Obama administration opposes Iran getting a nuclear weapons capability and that it is relying for now on diplomatic pressure to stop it.
After reports that Iran has, which was later confirmed by the Pentagon, Clinton said that a wide array of threats, including attempts by terrorists to obtain nuclear weapons, represent a "daunting" challenge for the United States.
The Iranians claimed the test launch was a success and Defense Secretary Gates agreed, saying "It was a successful flight test. The missile will have a range of approximately 2,000 to 2,500 kilometers," reports CBS News correspondent David Martin reports
That's 1,200 to 1,500 miles - more than enough to reach Israel and even parts of Europe, Martin reports. But the Iranians don't yet have a reliable weapon.
"Because of some of the problems they've had with their engines we think at least at this stage of the testing we think it's probably closer to the lower end of that range," Gates said.
At the same time, Iran continues enriching uranium, although not yet to bomb-grade levels. The CIA estimates Iran could have a nuclear weapon sometime between 2010 and 2015. But both the U.S. and Israel have launched covert operations designed to through sand in the gears by supplying faulty parts or designs, Martin reports.
Clinton also described a nuclear capability in Tehran as an "extraordinary threat," and said the U.S. goal is "to persuade the Iranian regime that they will actually be less secure if they proceed with their nuclear weapons program."
The secretary said she did not expect there would be any significant progress in getting Iran to enter into discussions on incentives to abandon a nuclear program at a time when there is a campaign there for the presidency.
"Our goal is to persuade the Iranian regime that they will actually be less secure if they proceed with their nuclear weapons program," Clinton told the Senate panel headed by Sen. Patrick Leahy, D-Vt.
She said that while there is a lot of discussion about timetables, "the goal is the same: a nuclear armed Iran with a deliverable weapon system is going to spark an arms race in the Middle East" and the greater region.
"That is not going to be in the interest of Iranian security," Clinton added. "At the same time, we see a growing recognition among a group of countries that they do not want to see this reality take place."
She said that she didn't know when the U.S. might "see some openness and some willingness to engage on this very important issue," but likely not during Iran's election season. "But we are going to pursue our diplomatic efforts," Clinton said.
Earlier Wednesday, President Mahmoud Ahmadinejad said Iran test-fired a new advanced missile with a range of about 1,200 miles, capable of reaching Israel and U.S. Mideast bases.
The announcement comes less than a month before Iran's presidential election and just two days after President Barack Obama declared a readiness to seek deeper international sanctions against Tehran if it did not respond positively by year-end to U.S. attempts to open negotiations on its nuclear program.
U.S. officials are hoping for a more moderate government after elections in June. But the real powers in Iran are the mullahs and they aren't up for election, Martin reports.
Analysts said the launch was likely intended for domestic consumption ahead of the June 12 elections, rather than a message to the U.S., which has criticized Iran's past missile launches as stoking instability in the Middle East.
"But I don't think the Obama administration and other nations will look at this as a constructive sign," said Patrick Clawson, deputy director for the Washington Institute for Near East Policy.
"Iran's long range missile test is not only provocative, but it puts both President Obama and the Security Council in a difficult position," said CBS News Foreign Affairs Analyst Pamela Falk from the U.N. "After three rounds of sanctions that have not worked, the best hope for a peaceful settlement continues to be for Iran to negotiate its way back to an inspections program."
"With Iran's election in less than a month, the situation might change," added Falk. "But Israel's new Prime Minister is pressing for more U.N. sanctions and Iran's current President Mahmoud Ahmadinejad is more defiant than ever."