The Iran-United States Claims Tribunal was established in 1981 as part of a crisis resolution following the U.S. Embassy staff incident in the relations between Iran and the United States. The significance of the precedent set by the Tribunal in the field of international arbitration cannot be denied, as it encompasses a large number of claims on various subjects, and examining its different dimensions is of great importance. Determining the applicable law is one of the necessary steps in the proceedings of international tribunals in process of disputes settlement. Accordingly, the Iran-United States Claims Tribunal has introduced a comprehensive system to determine the applicable law in Article 5 of its founding document, i.e. the Claims Settlement Declaration. In this regard, Article 5 of the Claims Settlement Declaration grants the tribunal a broad discretion to choose the applicable law. This grant of extensive freedom to the tribunal in determining the applicable law is proportional to the diversity and extent of the issues that are under the jurisdiction of the tribunal; Otherwise, determining the applicable law would have been very difficult. One of the consequences of the discretion endowed to the tribunal in Article 5 of the Claims Settlement Declaration was that the tribunal frequently used general principles of law in its decisions by relying on this article. General principles of law are, in fact, principles that are invoked in the absence of other positive rules to prevent a judge or arbitrator from facing a legal vacuum or non liquet. These principles play the same role in international law and are principles that are recognized by civilized nations. These principles also comprise those derived from national legal systems and formed within the international legal system. However, this freedom of choice for the tribunal does not mean permission to decide based on ex aequo et bono or other non-legal criteria. Rather, according to the explicit expression of Article 5, the tribunal must make its decisions on the basis of respect for law. In this regard, all decisions of the tribunal must be based on appropriate legal justification. The main question of this article is on what basis the tribunal has applied general principles of law in its proceedings. This article, by using descriptive-analytical method and evaluation of article 5, the Tribunal's precedents and related doctrine, has come to the conclusion that the Tribunal has appropriately applied the general principles of law as a source of international law in cases with international character. In the field of disputes with international character, such as determination of state responsibility, treaties implementation and violation and etc, just international law can be regarded as law that states are obliged to comply with. This is because international law is the only set of rules and principles that can limit the state sovereignty. However, international law cannot be considered as the governing law in commercial claims related to contract implementation, while a major part of the Tribunal's use of the general principles of law has been in this category of claims. After examining various bases for determining the applicable law in this regard, including contractual law, lex fori, transnational law, lex mercatoria and other instances raised by the parties during the tribunal's proceedings, this article concludes that none of the aforementioned bases can be suitable for the specific situation of the Claims Tribunal. This is because the Iran-United States Claims Tribunal, on the one hand, is an international tribunal with the characteristics of an international tribunal, but on the other hand, its jurisdiction has been extended to include private and commercial claims. Therefore, it cannot be considered like typical international commercial arbitration that is subject to theories such as the lex arbitri or lex mercatoria, nor can international law be considered to govern these types of commercial disputes due to their nature. Consequently, the tribunal has appropriately resolved this challenge by resorting to general principles of law, not as a source of international law. In some cases, the tribunal has applied general principles of private international law in determining the law governing the contract, and in this respect, it has indirectly used general principles of law in resolving the dispute. However, what distinguishes the tribunal's practice in this regard is that in numerous cases, the tribunal has also directly referred to general principles of law in the merits of the case and applied them to resolve the dispute. This is because the tribunal did not consider itself bound by any domestic legal system and, where it deemed appropriate, directly referred to general principles of law. This use of general principles of law in this way has been a turning point in international commercial arbitration, escaping the arbitrator from traditional limitations in determining the applicable law. The conclusion of the article is that the court has considered the general principles of law as an independent set of principles governing the contract and commercial relations. These principles also include the principle of autonomy, choice-of-law rules and other principles that have been recognized by most of the internal legal systems.