I've wanted to make .iso images on my Mac for a while now. At last I've found this formula:

hdiutil convert /path/to/filename.dmg \
  -format UDTO -o /path/to/savefile.iso

To make the .dmg file, just click the 'new image' toolbar button in Disk Utility. .dmg format is called 'read only' in the dialogue box.

Just in: It seems that the 'CD/DVD Master' format (.cdr) is actually the same as .iso. You just need to change the extension! (I've not yet tried this.)

(Originally from macOSXhints.com).