The territorial disputes in question concerned Iraq's Shatt al-Arab and Iran's Khuzestan Province, and Iraq had wished to negotiate to end Iran's support for the then-ongoing Iraqi Kurdish rebellion after suffering a military defeat in the 1974–1975 Shatt al-Arab conflict.

On 17 September 1980, shortly after the Iranian Revolution, the Iraqi government abrogated the treaty in light of another series of cross-border clashes between the two countries.

Today, friction continues on the two countries' border despite the treaty remaining binding under international law (per UNSC Resolution 619), and the detailed boundary delimitation[1] is still de jure in force since it was signed in 1975 and ratified in 1976 by both Iran and Iraq.

In 1963, after the Ramadan Revolution, the Ba'ath Party government led by Ahmad Hassan al-Bakr, launched a campaign against the Kurdish rebellion, that had been seeking independence from Iraq.

Tensions between the new government and the Kurds increased, with the Iraqi Armed Forces engaging in military action against Kurdish separatists.

Mustafa al-Barzani met with representatives from the American government to support the Kurds secretly, further weakening the Iraqi position which was further complicated by the outbreak of the Yom Kippur War.

Mohammad Reza Pahlavi was completely inflexible, and sought control over half of the Shatt al-Arab (Arvand Rud).

Saddam Hussein and Mohammad Reza Pahlavi attended the OPEC summit on 6 March 1975 in Algiers, where an agreement was made and signed with the mediation of Houari Boumédiène, the then Chairman of the Revolutionary Council of Algeria.

The Algiers Agreement placed the border between Iraq and Iran in the center of the main channel of the Shatt al-Arab (Arvand Rud) waterway, usually called the thalweg.

The two countries were required to commit themselves to maintain close and effective supervision over their common boundary and to end any intervention in the other's territory.

On 15 March 1975, the Iraqi and Iranian foreign ministers met with the Algerian representatives to establish a joint committee to mark the new border.

It was thought that with the end of international support, the Iraqi government would negotiate with the Kurds, but Saddam Hussein launched a major military campaign against the rebels, prompting Iranian monarch Mohammad Reza Pahlavi to intervene.

The war was ended in accordance with United Nations Security Council Resolution 619 and returned both parties to the Algiers Agreement of 1975.