The charge added to concerns that the government is backtracking on the democratic aims of the uprising that toppled the autocratic regime last year.
The complaint submitted against Mohamed Abu-Hamed by another former lawmaker also accuses him of trying to mobilize Egypt's minority Coptic Christians to protest and cause religious strife.
If the case is taken to court and he is found guilty, Abu-Hamed would face a maximum sentence of three years prison.
Abu-Hamed has a doctorate in Islamic theology and was the deputy leader of the liberal Free Egyptians Party, but split away to become an independent lawmaker before parliament was dissolved.
The investigation against Abu-Hamed comes two days after he led a march of around 3,000 people to the presidential palace to protest against the recently elected president, Mohammed Morsi, and his Muslim Brotherhood.
A number of other cases against critics of the Brotherhood, including TV host Tawfiq Okasha and newspaper editor Islam Afifi, who was briefly imprisoned, have stoked concerns that freedom of speech is being curbed, despite last year's uprising that called for greater rights with the downfall of longtime ruler Hosni Mubarak's regime.
The Brotherhood accused Okasha and his associates of being behind arson attacks on a number of the group's offices around the country.
He faces trial for his remarks, among them telling viewers that the killing Morsi was permissible. He claimed the Brotherhood and Morsi plan to kill him and retorted, “Fine, I declare it permissible to shed your blood, too.”
Despite his popularity in some segments, neither Okasha nor Abu-Hamed have the support of the youth and revolutionaries who helped engineer last year's uprising.
Youth activists launched a snide campaign last week aimed at raising money to send Abu-Hamed on a one-way trip from Egypt to Malaysia.
“We need to unite around one cause. We thought about what this cause could be: Abu-Hamed. In order to move from old Egypt to new Egypt we need to get rid of a few people: Abu-Hamed,” a young man says on a YouTube video titled “Get Abu-Hamed Out of Egypt.”
Many see Okasha as inflammatory and crass, and others consider Abu-Hamed an opportunist who has flip-flopped alliances since rising to fame during parliamentary elections late last year.
Although the protest march led by Abu-Hamed on Friday was relatively small, it reflects a wider feeling that the Brotherhood is power hungry after decades of being outlawed.
The Brotherhood won the most seats in parliament and then the presidency, and it has clashed with liberals over the formation of a body tasked with writing a new constitution, with secular representatives walking out.
Trying to counter the misgivings, Morsi, who is Egypt's first freely elected civilian and Islamist to take office, has reached out to a wide spectrum of groups and recently named the country's former defense minister — a holdover of the Mubarak regime — a Coptic Christian and at least two women as presidential advisers. His newly formed Cabinet is a mix of technocrats, former ministers from the military-appointed government and Islamists.
In his first legislative decree, Morsi banned the imprisonment of journalists who face trial for inciting hatred, insulting the president, slander and other related offenses
