Military authorities Wednesday began investigating whether a California National Guard (search) unit was created to spy on citizens, as dozens of demonstrators confronted Guard officials while armed soldiers stood by.

The federal probe of the nation's largest National Guard force involves the U.S. Army's inspector general, the federal National Guard Bureau's inspector general and the National Guard Bureau's legal division.

The unit has raised concern among peace activists that the Guard is resorting to the same type of civilian monitoring that helped fuel Vietnam War-era protests. During the 1960s and 1970s, the military collected information on more than 100,000 Americans. Such monitoring, while not illegal, would be a departure for the Guard.

"These are your mothers, grandmothers and neighbors," said George Main, president of Veterans for Peace (search) and an organizer of Wednesday's protest outside guard headquarters. About 30 demonstrators took part.

"They are not potential terrorist threats," Main said. "The excuse that these groups might be infiltrated is an insult to the intelligence of every Californian."

Under scrutiny is a California National Guard unit with a tongue-twisting name: the Information Synchronization, Knowledge Management and Intelligence Fusion (search) program. It was established last year, and came to public light after a recent story in the San Jose Mercury News.

Investigators also are looking into the Guard's monitoring of a Mother's Day anti-war demonstration at the state Capitol that was organized by several peace groups. The activities were documented in e-mails originating in Gov. Arnold Schwarzenegger's (search) press office and made public by the newspaper.

That monitoring was by a second unit, the Guard's Domestic Watch Center. Both units were under the command of Col. Jeff Davis, who has since retired and left the state.

Guard spokesman Lt. Col. Doug Hart said monitoring activities merely meant tracking media coverage of the protest. "We do not spy on people," Hart said. "Never have, never will."

A member of the women's peace group Code Pink, which was one of the groups involved in the Mother's Day protest, took issue.

"Even with a seemingly innocent act as watching TV, they're breaking the law," said Natalie Wormeli, who wore a T-shirt reading "One Nation Under Surveillance" at Wednesday's demonstration.

The Guard has described the unit as consisting of two members who monitor the military's classified e-mail system and seven others who help gauge terrorist threats to bridges, buildings and other structures.

Protesters spoke outside the Guard's headquarters in a suburban Sacramento office park, and at one point engaged in a verbal confrontation with Guard officials as soldiers carrying M-16 rifles stood in the background. One soldier blocked the locked headquarters door as the protesters tried to enter.

Officials in the Guard and the governor's office said they will cooperate in the federal inquiry. Hart said the federal units were declining comment on their probe. Army spokeswoman Lt. Col. Pamela Hart declined to even acknowledge that an investigation was under way.

Democratic state Sen. Joe Dunn has begun his own investigation into the Guard unit, but the acting adjutant general for the California National Guard, Brigadier General John R. Alexander, said he would provide no details to the lawmaker while the federal investigation is ongoing.

The Schwarzenegger administration also is concerned about whether the Guard "may have exceeded its mandate in the realm of intelligence operations," Deputy Chief of Staff Richard Costigan III said in a letter sent Wednesday to Dunn.

Costigan promised cooperation with both investigations.