An independent inquiry will look at the way the CPS handled a controversial case involving an undercover policeman who infiltrated a group of environmental activists.
Retired High Court judge Sir Christopher Rose will lead the probe into issues arising from the Ratcliffe-on-Soar power station protest case, Director of Public Prosecutions Keir Starmer QC said.
The case sparked widespread concern after it emerged former Metropolitan Police Pc Mark Kennedy spent a reported seven years posing as an environmental activist known as Mark Stone.
Six protesters accused of planning to invade Ratcliffe-on-Soar power station in Nottingham, the second largest in the UK, claimed prosecutors dropped charges against them after Mr Kennedy offered to give evidence on their behalf.
And 20 people previously convicted of conspiracy to commit aggravated trespass all avoided jail terms, and have since been invited to launch appeals against their convictions.
Investigations were launched after it was claimed the trial collapsed when the CPS discovered Nottinghamshire Police had tried to cover up Mr Kennedy's role by withholding secret tapes of meetings.
Announcing details of the independent inquiry, Mr Starmer today said: "In light of growing concerns about the non-disclosure of material relating to the activities of an undercover police officer in these cases, I said last month that I would set up an independent inquiry conducted by a senior legal figure.
"Sir Christopher Rose has accepted my invitation to conduct this inquiry.
"The terms of reference have been agreed with him and the Independent Police Complaints Commission (IPCC)."
He said the inquiry would look at whether the CPS approach to charging the case was right, and whether the CPS and prosecution counsel "complied with their disclosure duties properly", bearing in mind there was known to be an undercover officer involved.
The inquiry will also examine whether CPS arrangements for handling the existence of an undercover officer were adequate and properly followed, and whether relevant guidance and policy were followed.
Mr Starmer said Sir Christopher will make recommendations he considers appropriate, including recommendations about CPS policy and CPS arrangements for handling cases involving undercover police officers.
"Sir Christopher will have full access to all the available evidence and will examine the issues with the utmost thoroughness.
"Inevitably this will take time but will be completed as soon as is practicable."
Mr Starmer said the inquiry would "work in tandem" with an IPCC inquiry, adding: "Both organisations are committed to sharing all relevant information and arrangements are being made to ensure there is meaningful liaison between the two inquiries."
He said Sir Christopher would report his findings and recommendations to him, and he would make them public.