Politicians in Iran wore uniforms of the Revolutionary Guards in parliament on Tuesday in protest at the US decision to classify the nation’s military wing as a foreign terrorist organisation.

There were chants of “Death to America” as the president, Hassan Rouhani, declared the force was “dearer than ever in the hearts of the Iranian nation” and announced countermeasures against the US.

Donald Trump’s move on Monday marked the first time Washington has declared another nation’s military wing a terrorist organisation – in the same category as non-state groups such as Isis or al-Qaida.

Iran’s supreme leader, Ayatollah Ali Khamenei, who has the final say on all state matters, met members of the Revolutionary Guards on Tuesday, telling them: “Americans imagine they are designing and making trouble against the guard – in fact against the revolution and Iran – but their evil designs will not harm [the force]”.

Rouhani announced that US Central Command (Centcom), the Pentagon wing dealing with US operations in most of the Middle East and Iran, would be classified as a terrorist organisation and the US government as a sponsor of terror.

“Who are you to label revolutionary institutions as terrorists?” Rouhani asked in a televised speech. “You are the leader of world terrorism. This mistake will unite Iranians and the guards will grow more popular in Iran and in the region.”

Relations between Tehran and Washington frayed when Trump entered the White House two years ago and took a decisive turn for the worse last May when the president pulled out of a 2015 nuclear deal between Iran and six world powers, and reimposed sanctions.

The US had already blacklisted dozens of entities and people for affiliations with the Revolutionary Guards, but not the organisation as a whole.

Comprising an estimated 125,000-strong military with army, navy and air units, the Revolutionary Guards answer only to Iran’s supreme leader. They command the Basij, a religious volunteer paramilitary force, and control Iran’s missile programmes. Their overseas Quds forces have fought Iran’s proxy wars in the region, most notably in Syria.

On Monday the US secretary of state, Mike Pompeo, said the new designation was intended to isolate Iran and would allow the US to impose further sanctions, diverting financial resources used to fund terrorism and militant activity in the Middle East and beyond.

“This unprecedented step, led by the Department of State, recognises the reality that Iran is not only a state sponsor of terrorism but that the IRGC [the Guards] actively participates in, finances and promotes terrorism as a tool of statecraft,” a statement said.

The move has been welcomed by authorities in Saudi Arabia, Iran’s regional rival and a firm friend of the White House, where officials described it as a “serious and practical step to combat terrorism”.

However, the decision is likely to complicate US activities in countries such as Iraq and Lebanon, whose governments are US partners but where Shia political parties and militias have strong links to Iran.