The former Metropolitan Police officer's decision to publish details of his six years employed as bodyguard to the princess has angered colleagues.
Mr Wharfe is the first policeman to write a royal biography and Scotland Yard fears other protection officers may follow.
A spokesman said: "The Metropolitan Police sent a report to the Crown Prosecution Service seeking their advice regarding this matter - the possibility of legal action over this book."
Last month, Sir John Stephen, Met Commissioner, said he was "appalled" by the book, Diana: Closely Guarded Secret.
It documents problems between the princess and Prince Charles, and details romances with art dealer Oliver Hoare and cavalry officer James Hewitt.
The book also says she once escaped the attention of her bodyguards by jumping 20ft from a hotel window in Austria, to "disappear" for five hours.
The Official Secrets Act does not prevent Mr Wharfe from divulging personal information which does not jeopardise state security.
Bodyguards employed by Scotland Yard are not covered by a confidentiality agreement binding members of the royal household since 2000.
Mr Wharfe denies betraying the princess and says his book tells the truth about Diana and presents her in a positive light.
He says it will prevent her memory being "airbrushed from history".
After Diana's death in 1997, Mr Wharfe remained within the Royal Protection Squad and worked for the Duke of Kent before his retirement on 31 July.