FFP rules ban clubs from spending more than their generated revenue, a policy introduced in 2010 to prevent cash-rich owners from trying to buy success and distorting the transfer market.
"The Investigatory Chamber of the UEFA Club Financial Control Body has opened a formal investigation into Paris Saint-Germain as part of its ongoing monitoring of clubs under Financial Fair Play (FFP) regulations", UEFA said in a statement.
PSG president Nasser Al Khelaifi said: "It was essential for French football that we keep and help develop such a great talent in our championship".
Paris St-Germain are confident they will comply with Financial Fair Play rules despite UEFA opening an investigation over the signing of Neymar this summer for a world-record pounds 203.6 million and the extraordinary deal for Kylian Mbappe that could rise to £165.1 million.
"Paris Saint-Germain acknowledges the decision of the UEFA Financial Fair Play panel to immediately ensure that the Paris club's accounts are in line with the Fair Play criteria, as of 30 June 2018 for the 2017/2018 season", PSG's statement read.
PSG triggered Neymar's €222m buyout clause to acquire him from Barcelona on August 3, and sealed Mbappe's before Thursday's deadline on an initial loan in a deal that sources said is worth €180m plus bonuses. PSG will have an option to make his loan move permanent next summer and should they decide to activate it, then Mbappe will be at the club until 2022.
The 18-year-old Mbappe joins PSG on a season-long loan in what could ultimately be world's second most expensive signing after Neymar was signed earlier this year for $261 million.
PSG are owned by Oryx Qatar Sports Investments, an investment arm of Qatar's sovereign wealth fund.
In the scramble to replace Neymar after his unexpected exit, Barcelona have already spent 105 million euros, in a deal that could rise to 145 million euros, to lure another France starlet, Ousmane Dembele, from Borussia Dortmund.
Despite a massive outlay on players, PSG has failed to get past the quarterfinals of the Champions League in the past four seasons, and only once made the semifinals - back in 1995.
The "break-even" element states clubs can spend 30m euros more than they earn over a three-year period.