The Italian prime minister has been formally placed under investigation on suspicion of sex with underage prostitute

Silvio Berlusconi was tonight facing the potentially devastating possibility that he might be put on trial as an alleged sex offender.

The chief prosecutor in his home city of Milan said the Italian prime minister had been formally placed under investigation on suspicion of having sex with an underage prostitute. He was also accused of abusing his position to pressure the police.

The offences carry sentences totalling up to 15 years in jail. Berlusconi had not been charged, but had been invited to present himself for questioning, according to the prosecutor's statement.

The previous day Italy's constitutional court overturned key passages of a bill introduced by Berlusconi's government that would have shielded him from the courts. The double blow looked certain to weaken a leader whose majority in parliament has hung by a thread ever since he was deserted last year by his former ally and deputy, Gianfranco Fini.

The investigation concerns Karima El Mahroug, otherwise known as Ruby Rubacuori, a Moroccan teenager who told investigators last year – when she was 17 – that she had attended parties at Berlusconi's estate near Milan, one of which ended in an erotic game called "Bunga Bunga".

The period in which Berlusconi is suspected of relations with a juvenile prostitute, February to May 2010, coincides with that in which Mahroug is thought to have visited his estate. She has denied having sexual relations with the prime minister, but acknowledged accepting from him a gift of several thousand euros.

Berlusconi's lawyers said in a statement that the allegations were "absurd and groundless". They called the investigation a "very serious interference in the private life" of the prime minister.

Throughout the day, Berlusconi's political supporters kept up a barrage of outraged rebuttal, mingled with abuse of the prosecutors who had put him under investigation. The most serious accusation came in a joint statement by the leaders of the prime minister's Freedom People movement, decrying "the political use of justice to destabilise the political framework". One Berlusconi MP called the Milan prosecution service "a national disgrace".

The prime minister's followers argued that news of the investigation, which first emerged on the website of the newspaper Corriere della Sera, had been held back to do him maximum damage. Milan's chief prosecutor said Berlusconi had been formally made a suspect on 21 December.

But Antonio Di Pietro, the leader of the Italy of Values party (Italia dei Valori) and himself a former prosecutor, said: "On the contrary, the Milan prosecution service ought to be given recognition for having waited for the constitutional court's vote – so as not to influence public opinion in the runup to that very important ruling."

Mahroug became a nightclub dancer in Milan after running away from her parents and juvenile care. Her involvement with the prime minister came to light after she was arrested last May on suspicion of theft.

Instead of being returned to care, she was handed over to Nicole Minetti, a former showgirl who became Berlusconi's dental hygienist and, soon afterwards, a regional parliamentarian for his Freedom People movement.

The Moroccan teenager was released following phone calls to the police from the prime minister's office, during which it was claimed that Mahroug, whose father is a street trader, was actually the granddaughter of the Egyptian president, Hosni Mubarak.

Police raided Minetti's office today and reportedly carried out computer equipment. She was already under investigation for aiding and abetting prostitution, along with two other close associates of the prime minister, a newscaster on one of Berlusconi's three TV channels and a show business talent scout.

Police also tried to search the offices of an accountant who works for Berlusconi. But the operation was cancelled after it was claimed that the premises were covered by parliamentary immunity.

The age of sexual consent under Italian law is 14. But paying for sex with a prostitute under the age of 18 carries a sentence of up to three years. Politicians found guilty of abusing their authority risk jail sentences of up to 12 years.

Berlusconi split with his second wife in 2009. In an interview posted this week to the website of the newspaper La Repubblica, Mahroug said she would be grateful to Berlusconi for the rest of her life.

She said he suffered from loneliness. "To the extent that I knew Berlusconi, he is not so happy. On the surface he may seem happy, because he has all that money, that career: a man who everything he touches turns to gold; everything he touches works. But that's not everything in life. Someone with all that money doesn't even have wishes."