TEHRAN, Iran–In a major shift, a senior opposition figure announced he now recognizes Mahmoud Ahmadinejad as the head of Iran's government while standing by his claims that the election was rigged, the opposition leader's son said Monday.

Mahdi Karroubi's new position is a retreat from his statements following the June 12 presidential election, when he insisted Mr. Ahmadinejad's government is illegitimate.

The...