Nassar, who worked at the East Lansing school and treated athletes there, has pleaded guilty to molesting female athletes under the guise of medical treatment. He was sentenced in January and February in two separate hearings to 40 to 175 years and 40 to 125 years in prison.
Around 200 women, including Olympic gold medal-winning gymnasts Aly Raisman and Jordyn Wieber, gave courtroom statements at the sentencing hearings about Nassar's abuse, leading to the resignation of the USA Gymnastics' board.
Michigan State's president and athletic director have resigned.
The Department of Education said in a statement that its probe would centre on whether Michigan State met requirements under Title IX, a federal law that bars sexual discrimination in schools that receive federal funding.
Education Secretary Betsy DeVos said that a civil rights team would soon arrive on the East Lansing campus and that she was committed to ensuring that all students were secure from sexual misconduct.
"All institutions that fall short will be held accountable for violations of federal law," DeVos, a Michigan native, said in a statement.
The university said in a statement that it had been informed last week about the Title IX probe. "As we have been, MSU is cooperating fully with this and all investigations," it said.
Michigan State is also facing probes by the National Collegiate Athletics Association, U.S. Senate, Michigan House of Representatives and the state's attorney general, Interim university President John Engler has said.
The Department of Education is conducting a related investigation into whether Michigan State met federal rules on reporting on-campus crime and security information.
In a related development, Republican state Senator Margaret O'Brien said in a statement that she and a bipartisan group of lawmakers would introduce a legislative package to combat sexual assault and increase protections for survivors.
(Additional reporting by Keith Coffman in Denver; Editing by Cynthia Osterman)
