A legal source told Reuters that four anti-terrorist judges would lead an inquiry into gunman Mohamed Merah's killing of three Jewish children, a rabbi and three soldiers, and investigate his elder brother Abdelkader Merah for complicity.
"He has been placed under formal investigation in line with the prosecutor's requirements," the source said.
Mohamed Merah was shot dead by a police sniper on Thursday as he scrambled out of his apartment window, firing a pistol, after special force commandos stormed his home in the southern city of Toulouse to break a more than 30-hour siege.
He earlier told police negotiators he had carried out the three shootings in Toulouse and the surrounding area to avenge the deaths of Palestinian children and protest against the French army's role in Afghanistan. He said he regretted there were not more victims.
Since his death, the focus of the investigation has switched to Abdelkader, 29, who was already known to security services for helping smuggle Jihadist militants into Iraq in 2007. He is suspected of playing a role in providing logistical support to his brother.
Abdelkader had been in detention since dawn on Wednesday as police in Toulouse and then Paris questioned him. Being placed under formal investigation is the next legal step after being held in custody and means that a criminal trial is likely.