In recent years, the rapid expansion of digital technologies and the growing use of artificial intelligence in pricing mechanisms have profoundly transformed the dynamics of competitive markets. This article investigates how algorithmic predatory pricing can operate as a novel form of abuse of dominance and examines the challenges it poses for the enforcement of competition law. It also explores the extent to which national and international legal frameworks are capable of addressing such algorithm-driven conduct and identifies the reforms required for the Iranian legal system. The findings indicate that algorithmic predatory pricing, unlike its traditional counterpart, involves four fundamental challenges: opacity and the difficulty of establishing predatory intent, the speed and automation of price adjustments, the potential for autonomous coordination or tacit collusion among rivals, and the complexity of attributing legal responsibility among developers, deployers, and commercial users of the algorithm. These features complicate the assessment of predatory behaviour and limit the effectiveness of conventional competition law tools. A comparative analysis shows that certain advanced jurisdictions have begun adopting measures such as algorithmic transparency requirements and supplementary AI regulations to mitigate anti-competitive risks, whereas the existing legal framework in Iran remains insufficient to address algorithmic challenges. The article concludes that developing modern, transparent regulatory instruments—including disclosure obligations and oversight mechanisms for algorithmic pricing systems—is essential to prevent the emergence of algorithm-driven anti-competitive structures and to preserve the effectiveness of competition law in the future.