Many took part in mourning processions as they gathered at the 75,000-capacity Azadi ("freedom") stadium in Tehran to mark the eve of Ashura, one of the holiest days in the Iranian calendar.
For Shiite Muslims, Ashura marks the death of Imam Hussein in the seventh century, and is traditionally a day of sombre processions through the streets, in which black-clad men beat their chests and heads in anger and despair.
"Bear in mind that if football is going to be played on the eve of the Ashura, the atmosphere of this match must be 100 percent in line with Ashura," warned Friday prayer leader Ayatollah Ali Movahedi Kermani last week, according to the ISNA news agency.
"The entire stadium must be covered in black and shouts of Hussein must be heard constantly from the crowd. Instead of the clapping in these games, all should shout 'Ya Hussein'," he said.
"Spectators and players of both countries have been briefed to observe religious codes," General Alireza Adeli, the interior ministry's police chief, told the Tasnim news agency.
The AFC is highly sensitive to expressions of religious devotion during games and had asked for the black flags to be removed.
"We won't do that. The Hussein banners are people's beliefs," said Iranian football official Mohammad Reza Saket, promising to pay any resulting fines.
South Korean players and journalists said they would voluntarily wear black arm bands to show respect for the holy day.
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