Tracey Connelly allowed her son Peter to be tortured to death by her boyfriend Steven Barker and his brother Jason Owen in a horrific case that shocked the country.
The 34-year-old is now reported to have been offering pornographic photos of herself online.
A source told The Sun: "Authorities believe she was uploading images of herself and trying to flog them — possibly to sick perverts getting a kick out of her notoriety.
"It doesn’t get any more depraved than this. She clearly wasn’t ready to be released into the community."
Last year Connelly demanded the council give her a bigger house as she "suffered" with the loss of her son.
Tracey Connelly wants to be bumped up the waiting list for a two-bedroom home as she believes she is entitled to special treatment.
A source told the Mirror: "She is extremely demanding, and for Tracey it's all about her. She wants her own nice flat but when you come out of jail you get what you are given, but Tracey won't accept that.
"The greatest irony is that she sees herself as the victim in all of this, so expects to be looked after."
Connelly was jailed in 2009 after her little boy was found dead in 2007 aged just 17 months.
His body was covered in horrific injuries including a broken back.
Peter Saunders, CEO of the National Association for People Abused in Childhood, told the Mail Online: "t is a complete mess. This case is just another sad, shocking and glaring example of the failings of the prison system - the total failure to rehabilitate these offenders
"Obviously, we don't and we can't jail these people who commit these dreadful crimes for the rest of their lives, but some of these offenders probably should be tagged for the rest of their lives, simply as a way of keeping them on a radar.
"It just shows that there appears to be no genuine rehabilitation in prisons."