The main reformist coalition, inspired by ex-president Mohammad Khatami, can contest just under half the seats in parliament with the National Confidence Party of reformist cleric Mehdi Karroubi faring only a little better.
Reformist officials had howled with dismay when initial vetting removed 2,200 mainly reformist candidates from the race and the hardline Guardians Council has now reinstated hundreds of candidates.
But reformist officials warned that their chances of challenging the current conservative dominance of parliament in the March 14 polls were still weak.
"We can only compete in 120 seats," the deputy chairman of the coalition, Hossein Marachi, told AFP.
"Around 900 reformist candidates registered for the elections but we can only compete in 111 out of the 290 seats in parliament," said another official from the reformist coalition, who asked not to be named.
The situation is a little rosier for Karroubi's National Confidence Party, which espouses the same reformist goals of economic development as the coalition but maintains an independent identity.
"We have 160 candidates standing in Tehran and the provinces. Thus we can compete in 55% of the seats in parliament," said the party's spokesman Esmaeel Gherami Moghadam.
He emphasized that around 80% of the candidates would be shared between the two reformist groups.
While some reformist officials had said after the initial stages of vetting they could only compete in 10% of the seats, it appears the disqualifications have still dealt a major blow to their hopes.
Safdar Hosseini, another reformist coalition official who was economy minister under Khatami, made a bitter and impassioned attack on the disqualifications.
"Among the disqualified candidates there are former ministers, former governors, wounded (Iran-Iraq) war veterans and the brothers of three martyrs who have all served this country all their lives," he said.
The Guardians Council, which has the final say in the vetting process, has said it reinstated more than 1,000 candidates who were disqualified in the initial vetting.
But its final decision said it was allowing 4,500 candidates to stand for parliament although 2,200 candidates had been disqualified - strangely the similar number as those disqualified in the initial vetting.
Khatami called the original vetting a "catastrophe" while another influential ex-president, Akbar Hashemi Rafsanjani, urged the electoral watchdog to reinstate moderate candidates.
One criterion prospective candidates must meet is that they should demonstrate sufficient loyalty to the Islamic revolution and the idea of clerical leadership as enshrined by its founder, Ayatollah Ruhollah Khomeini.
The disqualifications are a repeat of the mass vetoing of reformist candidates in the last elections in 2004, which allowed the conservatives to easily seize control of parliament from the reformists.
Although the campaign is not yet officially underway, there have already been bitter exchanges, most notably when a conservative Web site attacked Khomeini's son Hassan after he openly criticized the disqualifications.