The public inquiry into undercover policing methods may "expose both creditable and discreditable conduct, practice and management", its chairman has warned.
In delivering his opening remarks, Lord Justice Pritchard said the inquiry will "need to examine any evidence of the targeting of individuals for their political views or participation in social just campaigns".
The public inquiry, ordered by Home Secretary Theresa May, will look into police infiltration of political and social justice groups in England and Wales since 1968.
It was announced after claims that Scotland Yard had spied on campaigners fighting for justice for murdered black teenager Stephen Lawrence.
Lord Justice Pritchard said: "It seems likely that the inquiry will expose both creditable and discreditable conduct, practice and management.
"This is the first time that undercover policing has been exposed to the rigour of public examination.
"At the conclusion of its investigation, the inquiry will report to the Home Secretary and make recommendations as tot he deployment of undercover police officers in future."