The agency said an explosion was heard at 2:40 p.m., local time, Monday, and quoted Mohammed Mehdi Ismaili, the deputy governor, as saying it was heard across the city.
Later, however, Ismaili told the official news agency IRNA reports of an explosion were baseless and fabricated.
Several residents told the British daily The Guardian they heard a loud blast and the windows of their homes rattled.
"We heard a sound similar to that of an explosion but we have received no reports about its causes and consequences," Gholamreza Ansari told the Iranian Students News Agency, the newspaper said.
The Guardian noted the Isfahan nuclear facility feeds the country's main nuclear enrichment plant in Natanz, northeast of the city.
Gill Tudor, a spokeswoman for the International Atomic Energy Agency said reports of an explosion were received but there was no further information, Gulf Daily News said Tuesday.
"Not every explosion over there should be tied to reconnaissance and stories from movies," Israeli Intelligence Minister Dan Meridor told Army Radio when asked to comment on Monday's incident. He added, however, "There are countries who impose economic sanctions and there are countries who act in other ways" in dealing with the Iranian nuclear threat.
Monday's incident comes weeks after a powerful explosion rocked a military missile base west of Tehran killing more than 30 members of Iran's Revolutionary Guards, including Cmdr. Hassan Moghaddam, described as the architect of Iran's missile program, The Guardian said.