Parliament's Intelligence and Security Committee (ISC) will broaden its probe into if laws on intercepting private communications are adequate in the internet age amid fears over the "impact upon people's privacy as the agencies seek to find the needles in the haystacks".
Earlier this year, an ISC inquiry found GCHQ did not use the US internet monitoring programme in order to circumvent UK laws.
The committee said 197 counter-intelligence reports generated by GCHQ through the US Prism programme - exposed by former intelligence analyst Edward Snowden - had been properly signed off by ministers.
The furore over the activities of agencies on both sides of the Atlantic prompted the committee to mount a wider investigation.
ISC chairman Sir Malcolm Rifkind said: "In recent months concern has been expressed at the suggested extent of the capabilities available to the intelligence agencies and the impact upon people's privacy as the agencies seek to find the needles in the haystacks that might be crucial to safeguarding national security.
"There is a balance to be found between our individual right to privacy and our collective right to security. An informed and responsible debate is needed.
"The Intelligence and Security Committee of Parliament has therefore decided to broaden the scope of its forthcoming inquiry to consider these wider questions, in addition to those relating to the existing legislative framework."
Nick Pickles, director of Big Brother Watch, said; "This is a welcome step forward given the widespread concern that Britain's surveillance laws are not fit for purpose,"