William Hague has warned Iran it faces "serious consequences" over the attack on the British embassy in Tehran.
Hundreds of protesters surged onto two compounds this afternoon, putting the safety of staff at risk and causing "extensive damage" to property, the foreign secretary said.
"Clearly there will be other, further, and serious consequences. I will make a statement updating parliament on this tomorrow [Wednesday]."
Iranian police protected Britain's ambassador and some staff earlier from a large crowd outside, Hague said.
He added: "There has been a confusing situation at times as to the whereabouts of certain staff. I wouldn't use the term hostage. Clearly there have been situations where the Iranian police have intervened to try to ensure the safety of our staff.
"We are grateful for that but this situation should never have been allowed to arise in the first place."
Earlier on Tuesday, Iranian protesters stormed the buildings in Tehran, tearing down the union flag, throwing documents from windows, and reportedly briefly taking hostage six members of staff.
In scenes reminiscent of the takeover of the US mission in the same city in 1980 – which led to a long hostage standoff – crowds protesting against sanctions targeting Iran's nuclear programme smashed windows and burned a building at the main embassy compound, removing the British flag and replacing it with the Iranian one.
Six staff members were taken hostage at the ambassador's residence in northern Tehran, according to the semi-official Mehr news agency, but were later freed by police.
David Cameron chaired a meeting of the government's Cobra security committee on Tuesday afternoon, and the Iranian charge d'affaires was summoned to the FCO.
Hague said Iran had "committed a grave breach" of the Vienna convention, which demands the protection of diplomats and diplomatic premises under all circumstances. He added: "We hold the Iranian government responsible for its failure to take adequate measures to protect our embassy as it is required to do.
"I spoke to the Iranian foreign minister this afternoon to protest in the strongest terms about these events and to demand immediate steps to ensure the safety of our staff in both embassy compounds."
The White House also issued a strong protest.
Iran's foreign ministry later said it regretted the incidents, the ISNA news agency reported. It quoted a government statement that said: "The foreign ministry regrets the protests that led to some unacceptable behaviours.
"We respect and we are committed to international regulations on the immunity and safety of diplomats and diplomatic places."
Hague said of Iran's foreign minister, Ali Akbar Salehi: "While he said he was sorry for what had happened and that action would be taken in response, this remains a very serious failure by the Iranian government.
"The safety of our staff is our utmost priority. On our latest information, it now appears that all our staff and their dependants are accounted for. We are urgently establishing the whereabouts of our locally engaged security staff to ensure their wellbeing."
British nationals have been warned against "all but essential travel" to Iran, and the small number in the country were told to stay indoors and await advice.
The attack came two days after the Iranian parliament voted to expel the British ambassador, Dominick Chilcott, in retaliation for the new economic sanctions imposed by the west.
Ilna, another semi-official news agency, said the protesters had "conquered" the embassy. The events were shown live on state-run Press TV.
About 1,000 gathered on the street in front of the building, waving pictures of the Iranian nuclear scientist Majid Shahriari, who was assassinated in Tehran last November. Others held pictures of another assassinated Iranian scientist, Masoud Ali Mohammadi, and a senior commander of the elite Revolutionary Guard, Qassem Suleimani, who is said to be in charge of the group's overseas operations.
State TV reported that another group of hardline students had gathered at the gate of the British ambassador's residence in northern Tehran at the same time.
On Sunday, the Iranian parliament passed a bill to cut Iran's diplomatic ties with Britain and downgrade Tehran-London relations from an ambassadorial level to that requiring chargés d'affaires.
The move came in retaliation against the economic sanctions imposed by the west.
Tensions with Britain date back to the 19th century, when the Persian monarchy gave huge industrial concessions to London that led to significant British control over Iran's oil industry.
But they have become increasingly strained as the west accuses Iran of trying to develop nuclear weapons – a charge Tehran denies.
During the vote on Sunday, Mehdi Kuchakzadeh, a Tehran MP, suggested Iranians could raid the British embassy, implying a possible recurrence of the 1979 US hostage crisis in Iran. "The British government should know that, if they insist on their evil stances, the Iranian people will punch them in the mouth, exactly as happened against America's den of spies, before it was approved by officials," Kuchakzadeh said.
"We must lock the British embassy and ignore them until they come begging like the Americans," another MP, Mahmoud Ahmadi Bighash, said in quotes carried by the Borna news agency.
