Independent officials will examine whether police tried to cover up the role of an undercover colleague who infiltrated a group of environmental activists.
Officials from the Independent Police Complaints Commission (IPCC) will conduct their own inquiry into the controversy surrounding Pc Mark Kennedy.
The former Met officer monitored the actions of protesters across Europe under the guise of a long-haired, drop-out climber called Mark Stone.
The case against six demonstrators accused of conspiring to shut down Ratcliffe-on-Soar power station collapsed on Monday after prosecutors dropped the case. Their legal team claimed the decision was made after the undercover officer had a crisis of conscience and offered to give evidence on their behalf.
The dramatic development prompted a wider debate on controversial police tactics to monitor political and environmental groups operating on the fringe of legality.
Jobless Mr Kennedy, who is now in hiding, has called in PR guru Max Clifford as he prepares to sell his story.
The IPCC review comes after Chief Constable Julia Hodson said there will be an internal review into the secret operation.
Meanwhile, the Times reported that the trial collapsed when the CPS discovered Nottinghamshire Police withheld secret tapes of meetings.
A Nottinghamshire Police spokesman said: "The force has requested the investigation reviews all the elements of policing relating to this case, to establish whether they were carried out in an ethical and proportionate manner, within the expected code of practice. In the circumstances therefore until the IPCC's report has been received, it would not be appropriate to add to this statement at this stage."
Amerdeep Somal, of the IPCC, said the inquiry will focus on the alleged failure of Nottinghamshire Police to disclose relevant material to prosecutors.
