Former Detective Sergeant Mark Kearney, who worked for Thames Valley Police, said the pressure to secretly tape Labour MP Sadiq Khan came from colleagues in the London force.
In a court statement from his lawyers reported by the BBC, Kearney said there was "significant pressure from the Metropolitan Police requesting that we covertly record a social visit between a terrorist detainee and a member of parliament".
"The MP concerned was Sadiq Khan ... I did record the visit but have never felt it was justified in these circumstances," the statement added.
Justice Secretary Jack Straw has ordered an investigation into the allegations, first reported in a Sunday newspaper.
The paper said Khan, MP for Tooting in south London and a former human rights lawyer, was bugged twice while meeting the constituent in prison.
The inmate, Babar Ahmad, is accused of running Web sites supporting terrorism and raising funds for militants in Chechnya and Afghanistan, and with urging Muslims to fight a "holy war".
An electronic listening device was hidden in a table at Woodhill prison in Milton Keynes and picked up conversations between the two in 2005 and 2006, it said.
The pair were talking about a U.S. request for Ahmad's extradition to face terrorism charges, the newspaper reported.
Police have been forbidden to eavesdrop on Westminster politicians since a bugging scandal involving Labour Prime Minister Harold Wilson's government 40 years ago.
Conservative Shadow Home Secretary David Davis said it appeared that Straw had lost control of his department.
"It is beyond belief that the department would not flag up to a minister that the Wilson doctrine had been broken within the department," he said.
Liberty Director Shami Chakrabarti called for "simpler and stronger surveillance laws with warrants issued by judges, not policemen or politicians".
A Metropolitan Police spokeswoman declined to comment.
