http://en.wikipedia.org/wiki/Iranian_Revolution#Shah_and_the_United_States<snip>The first major demonstrations against the Shah began in January 1978. Between August and December 1978 strikes and demonstrations paralyzed the country. The shah left Iran for exile in mid-January 1979, and two weeks later Ayatollah Khomeini returned to Tehran to a greeting by several million Iranians. The royal regime collapsed shortly after on February 11 when guerrillas and rebel troops overwhelmed troops loyal to the Shah in armed street fighting. Iran voted by national referendum to become an Islamic Republic on April 1, 1979, and to approve a new theocratic constitution whereby Khomeini became Supreme Leader of the country, in December 1979. snip
Causes
The revolution was populist, nationalist and later Shi'a Islamic. It was in part a conservative backlash against the Westernizing and secularizing efforts of the Western-backed Shah, and not-so-conservative reaction to social injustice and other shortcomings of the ancient regime. The Shah was perceived by many as beholden to — if not a puppet of — a non-Muslim Western power, (the United States), whose culture was contaminating that of Iran. The Shah's regime was also seen as oppressive, brutal, corrupt, and extravagant. The regime also suffered from basic functional failures — an overly-ambitious economic program that brought economic bottlenecks, shortages and inflation. Security forces were unable to deal with protest and demonstrations; Iran was an overly centralized royal power structure. The extraordinarily large size of the anti-shah movement meant that there "were literally too many protesters to arrest", and that the security forces were overwhelmed.
That the revolution replaced monarchy and Shah Pahlavi with Islamism and Khomeini rather than another leader and ideology is credited in part on the spread of the Shia version of the Islamic revival that opposed Westernization, saw Ayatollah Khomeini as following in the footsteps of the beloved Shi'a Imam Husayn ibn Ali, and the Shah in those of Husayn's foe, the hated tyrant Yazid I. Also thought responsible was the underestimation of Khomeini's Islamist movement by both the Shah's regime — who considered them a minor threat compared to the Marxists and Islamic socialists — and by the anti-Shah secularists — who thought the Khomeinists could be sidelined.