With the American presidential elections settled, space has opened for progress on the Iranian nuclear issue and broader US-Iran relations. However, the policy options on the table for the United States range from the disastrous to the auspicious. Each of the paths, from full-scale war to diplomatic engagement, rest on different assumptions about the regime in Tehran and its behavior. Although engaging Iran presents many challenges, it is the best path for the Obama administration. While an imperative exists for engagement, the US policy is at risk of going astray by emphasizing sectarian Sunni-Shia conflicts and siding with radical Islamists, repeating the pitfalls of Afghanistan in the 1980s.