The first death sentence has been passed against a defendant accused of involvement in the mass protests in Iran against President Mahmoud Ahmadinejad's disputed re-election, prompting fears of a wave of executions against opposition activists.

A revolutionary court in Tehran handed the penalty to Mohammad Reza Ali-Zamani, 37, after convicting him of muhabereh – taking up arms against Iran's Islamic system.

The sentence was imposed after he confessed to working for a little-known exile group, the Iran Monarchy Committee, which Iranian officials describe as a terrorist organisation. Prosecutors alleged that he plotted political assassinations with US military officials in Iraq before returning to Iran "aiming at causing disruption during and after the election".

Ali-Zamani admitted guilt during a series of public mass trials that began in August in which scores of senior pro-reformist politicians confessed to fomenting the unrest that followed Ahmadinejad's victory. Opposition leaders condemned the events as "show trials" and say defendants were tortured to force them to confess. Human rights campaigners today challenged Ali-Zamani's conviction and warned that it paved the way for further politically driven executions.

"It's not a good omen," said Hadi Ghaemi, of the International Committee for Human Rights in Iran. "If this is the trend of sentencing then it spells really bad news that we should expect more political executions along these lines. That's why this verdict has to be protested right now both inside and outside Iran."

More than 100 people arrested in the upheaval remain in custody, including prominent supporters of the defeated reformist candidates, Mir Hossein Mousavi and Mehdi Karroubi, who insist the election was stolen.

Unlike many others in detention, Ali-Zamani is not well known. His indictment said he had joined the Iran Monarchy Committee after hearing about it on a television satellite channel. His activities are said to have included distributing anti-regime CDs and propaganda, as well as copies of the Satanic Verses.

Ali-Zamani was accused of meeting an American called Frank in the Iraqi city of Irbil and passing information about conditions inside Iran in exchange for money. He was also alleged to have received instructions on how to build a chemical weapon from a fellow member of the IMC. Another part of the indictment alleges that he met two US military officers named "Mike and Robert" and gave them information on Iranian officials who had allegedly been targeted for assassination.

Prosecutors claimed that Ali-Zamani – who they say had a criminal record for forging revolutionary guard and judicial stamps – took part in an operation, called Salman, in which he gave the IMC information on members of the hardline Basij volunteer militia. They said he had conducted "vast communication activities" inside Iran before being arrested by intelligence officers.

The allegations were dismissed by the IMC, which is run by Iranians living in Europe and the US. Iran has previously accused the group of being behind a bombing in a Shia religious centre in Shiraz last year that killed 15 people.

A committee spokeswoman, Dordaneh Fouladvand, confirmed that Ali-Zamani had worked with the organisation but insisted he had played no role in the post-election protests. His activities had been limited to working for its radio station, Radio Tondar, she said.

"We are surprised by the confession he has made in court. He has given it under pressure and we strongly deny all he has said," Fouladvand said. "He had absolutely no links with the Americans and hasn't been involved in any operations inside Iran. His job was simply to pass on news for our radio station and to make broadcast packages."

Ghaemi said Ali-Zamani's arrest may have happened before the election, raising the possibility his execution verdict had been passed to deter further protests. "What is significant is that the indictment makes clear that before he could engage in any action, he was arrested by the intelligence ministry," he said.

"The text shows that there is no action or crime that they can tie him to."