What is the relationship between women, the veil, and the Iranian state?

In Islam, the veil, or hijab, is an act of modesty and religious expression for women. Because of the variety of different sects of Islam, there are varying degrees of hijabs and hijab-wearers. Some women choose not to wear the hijab at all, while some women wear entire body coverings with only their eyes visible.
The Iranian state, however, has legislated and restricted the choices of these women. In 1936, for a period, the hijab was outlawed altogether in an attempt to Westernize the country. For many, however, the hijab was a deliberate action of religious expression, and forcing them not to wear it was tantamount to religious persecution (for a much less severe example, but understandable by a predominantly Christian audience, imagine if displaying crosses of any form—on a necklace, tattoo, or article of clothing—was outlawed altogether).
In later years, however, after the revolution, it was decreed that women wear full body coverings. So the choice of women to wear hijabs or similar attire has frequently been restricted and legislated by the state of Iran.

Iran's main religion is Islam, with the majority of its population identifying as Muslim. In the Islamic faith, women are given the choice whether or not to wear a veil in public. This veil is known as a "hijab." If they do choose to wear a hijab, they are required to wear it in public and around men who are not family. Women do not have to wear a hijab at home around family.
Many Westerners think the hijab is a requirement for all Muslim women. Perhaps this stereotype rises from observing other orthodox communities, such as Greek Orthodoxy or Jewish Orthodoxy. Female members of those religions are required to wear a veil. In Islam, women have a choice when they reach adulthood.
The veil, or hijab, is a sign of a woman's commitment to Islam and represents her dedication to following Allah. However in the modern era, just because a woman decides not to wear a hijab does not mean she does not observe her faith. One reason a woman may choose not to wear a veil is because it comes with a strict dress code, where she must cover all of her arms and legs.
There are multiple stylistic ways to wear a hijab. In Iran, as well as other countries where Islam is the dominant religion, women view the veil as a public display of their faith.

After the Islamic revolution, the Ayatollah Khomeini imposed the wearing of the veil on all Iranian woman, allegedly to ensure their chastity and to protect them from western decadence.
To Nafisi, an American educated college professor and westernized woman, having to wear the veil was a symbol of the oppression of woman by the fundamentalist Iranian government as well as a symbol of the government's totalitarianism, in which the needs of the individual were subordinated to the needs of the state.
Nafisi uses Nabokov's Invitation to a Beheading to expose Iran's totalitarianism. In Nabokov's novel, the main character, Cincinnatus, is sentenced to death for not fitting in. The imposition of the veil on women is a way of enforcing a similar conformity. Women can be harassed as "provocative" even for having a stray hair come out from under the veil, and therefore, as Nafisi points out, deliberately letting a stray hair fall loose becomes a symbol of defiance against the state. Nafisi states that because totalitarian regimes are so oppressive, tiny acts function as forms of rebellion. Her book group, in which she reads "decadent" American European texts in her apartment with selected female students therefore becomes an act of rebellion.

Muslim women in Iran have historically had their ability to choose whether or not to wear the veil, or hijab, limited by the Iranian state. Reza Shah Pahlavi, in an attempt to modernize (or, as some argue, westernize) Iran, banned the veil for women in 1936. This ruling was met with protests throughout Iran, because many women chose to wear the hijab for religious or traditional cultural reasons. After many protests organized by Iranian women, the ban was lifted in 1941. However, this was not the last time the hijab became subject to state sanctioning. Shortly after the Islamic Revolution of 1979, the new leader of Iran, Ayatollah Khomeini decreed that women must wear the chador in public. The chador covers the entire body, unlike the hijab, which only covers the hair, neck, and chest. This ruling was also met with demonstrations led by women throughout the country. Today, enforcement of the law is less strict; many women wear the hijab rather than the chador, and foreign women traveling in Iran are not required to wear the veil. However, the veil is still mandated by state law, and women continue to demonstrate against it.