The controversial broadcaster was at risk of being banned in the UK last year after being rapped by Ofcom for airing an interview with imprisoned Newsweek journalist Maziar Bahari that was conducted under duress.
But media regulator Ofcom instead opted to impose a £100,000 fine on Press TV, which is the English-language outlet of the Iranian state.
However, Ofcom said that during the course of imposing the sanction on Press TV, the broadcaster revealed that its editorial control actually rested with Press TV International, based in Tehran.
Broadcasting rules state that UK licence holders must be in "general control" of their TV service, including all programmes shown on the network.
Ofcom gave Press TV the opportunity to have its operations in Tehran "correctly licenced" as part of a "minded to revoke" letter.
Press TV was offered the chance to either switch editorial control for its programming to the UK or transfer the entire broadcasting licence to Iran.
However, Press TV has failed to make any necessary applications for the licence, and so Ofcom has opted to revoke it entirely.
The channel, which counts former MP George Galloway among its presenters, is expected to be removed from the Sky platform by the end of January 2012.
According to Ofcom, Press TV is also "unwilling and unable" to pay the £100,000 fine levelled against it. The watchdog said that it is pursuing this as "a separate matter".