Team Melli had defeated South Korea 15-4 and Thailand 26-7 and lost to China 15-7 in Group A.
Iran booked a place in the semifinal after defeating Singapore 13-6 but failed to advance to final, suffering an 18-11 loss against Japan.
A record high of nearly 12,500 athletes from 45 countries and territories compete across 40 sports in the 2022 Asian Games.
Iran has sent 289 male and female athletes to the Games in 34 sports events.