The probe by Rome prosecutors comes after a former priest, Patrizio Poggi reported to police around 20 allegedly paedophile priests, among them five prelates including an unnamed Monsignor and the private secretary to a bishop
Poggi also presented to police a young male witness and gave the names of the alleged sexual abuse victims.
The probe spearheaded by prosecutor Maria Monteleone is also investigating a suspected prostitution racket that arranged gay encounters for priests.
After a tip-off from Poggi, police tailed a former soldier and alleged 'recruiter' and observed him accompanying a teenage boy inside a Rome church.
Poggi was convicted of the sexual abuse of five teenage boys aged 14 to 15 in the late 1990s, handed an eight-year jail sentence and ordered to pay the boys 50 million Italian lire (25,000 euros) in compensation.
Poggi's prison sentence was cut to five years but the Catholic Church refused to reinstate him after his release.