Many believe the bill could have reignited the protests that engulfed the Islamic Republic after the 2022 death of Mahsa Amini.
The controversial law, which was approved by the parliament in September 2023, will not be sent to the government as planned this week, according to one of the country's vice presidents.
The development effectively means that Iran has halted enacting the legislation.
The law levies harsher punishments for women who refuse to wear the hijab and for businesses that serve them, penalties previously rejected by Iran's reformist President Masoud Pezeshkian as he tries to restart talks with the West over sanctions imposed on Iran over its nuclear programme.
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