The multistate inquiry, led by James, will focus on the potential anti-competitive conduct stemming from Facebook's dominance in the industry, reported The Washington Post.
"Even the largest social media platform in the world must follow the law and respect consumers. I am proud to be leading a bipartisan coalition of attorneys general in investigating whether Facebook has stifled competition and put users at risk," James said in a news release.
"We will use every investigative tool at our disposal to determine whether Facebook's actions may have endangered consumer data, reduced the quality of consumers' choices, or increased the price of advertising," she added.
Facebook owns three of the top ten communications platforms in the world, including Whatsapp and Instagram. Concerns over the company's dominance in social media and online advertising have been raised often in the past.
Meanwhile, a separate investigation is expected to also be launched against Google by half of the US' attorneys generals, an announcement on which is expected to be announced on Monday in Washington.