The largest demonstrations in years have left at least 48 protesters dead, human rights groups say. Trump told reporters on Friday that Iran was in "big trouble'.
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Iran also sent sent a letter to the United Nations Security Council blaming the US for turning the protests into what it called "violent subversive acts and widespread vandalism" in Iran. Trump, meanwhile, said Iran was "in big trouble".
The protests, in their 13th day, erupted over the economy and have grown into the largest in years - leading to calls for an end to the Islamic Republic and some urging the restoration of the monarchy.
At least 48 protesters and 14 security personnel have been killed, according to human rights groups.
"We will be hitting them very hard where it hurts," Trump said at the White House on Friday, adding that his administration was watching the situation in Iran carefully and that any US involvement does not mean "boots on the ground".
"It looks to me that the people are taking over certain cities that nobody thought were really possible just a few weeks ago," he said.
These remarks echo ones the US president made about the Iranian government on Thursday, where he pledged to "hit them very hard" if they "start killing people".
Khamenei remained defiant in a televised address on Friday.
"Let everyone know that the Islamic Republic came to power through the blood of several hundred thousand honourable people and it will not back down in the face of those who deny this," the 86-year-old said.
Later, in remarks made to a gathering of supporters and broadcast on state television, Khamenei doubled down, saying Iran "will not shirk from dealing with destructive elements".
Iran's United Nations ambassador accused the US of "interfering in Iran's internal affairs through threats, incitement, and the deliberate encouragement of instability