Little cherry virus 1 (LChV-1), a member of the genus Velarivirus within the family Closteroviridae, is an important virus associated with little cherry disease in Prunus species. Given the economic importance of sweet cherry in Iran and the limited information available on the genetic diversity of LChV-1, this study aimed to characterize an Iranian isolate of the virus at the molecular and evolutionary levels using RNA-seq. The complete genome sequence of the Urmia isolate exhibited the characteristic genomic organization of LChV-1 and the genus Velarivirus. Phylogenetic analyses based on the complete genome and selected genes placed the Urmia isolate within a recognized LChV-1 phylogenetic group and revealed a close relationship with several European isolates. Genetic diversity analyses indicated greater conservation of replication-associated regions, particularly RdRp, compared with structural proteins. The dN/dS analyses indicated that purifying selection predominated across the examined genes. In addition, computational analyses provided evidence for recombination within the LChV-1 population, suggesting that recombination may contribute to the generation of genetic diversity in this virus. Overall, the findings indicate that evolutionary dynamics of LChV-1 are shaped by the interplay of mutation, recombination, and natural selection. This is the first report of the complete genome sequence of LChV-1 from Iran.