Revealing sensitive documents connected to the assassination of an INLA chief could damage national security, the High Court heard on Thursday.
The widow of Ronnie Bunting is locked in a legal battle over an alleged attempt to prevent Northern Ireland's Attorney General from ordering a new inquest.
But lawyers for the British Government have raised concerns over the disclosure of some material in the decision-making process.
Bunting was murdered by loyalist paramilitaries at his west Belfast home 40 years ago in an attack involving suspected state collusion.
His wife Suzanne was badly injured in the shooting, which also claimed the life of an INLA associate.
She alleges the Secretary of State unlawfully decided calls for a fresh inquest should be dealt with by Attorney General Brenda King's counterpart in England and Wales because of sensitivities in the case.
During a brief hearing in open court on Thursday, a judge was told that revealing some material would go against the interests of justice.
Counsel for the Secretary of State said: "There is material... and it's disclosure would be contrary to national security."
Proceedings then moved to a closed hearing to further examine those submissions, with a special advocate present to protect Mrs Bunting's interests.
The son of a major in the British Army, Ronnie Bunting was a founding member of the INLA after becoming involved in Irish republicanism during the early Seventies.
In October 1980, loyalist gunmen opened fire at his Downfine Gardens home, killing him and another INLA man, Noel Little.
Mrs Bunting sustained bullet wounds to her neck, arm and hand in the shooting.
In 2016 a newspaper reported claims that an undercover RUC unit had been watching the property due to intelligence that Bunting's life was in danger.
The surveillance operation was allegedly withdrawn for unexplained reasons before the assassination.
According to papers in the case, Mrs King's predecessor aS Attorney General, John Larkin QC, had been considering whether to order a new inquest into the killing.
But in 2019 the Secretary of State decided responsibility should be transferred to the British Government's chief legal adviser and Advocate General for Northern Ireland.
Mrs Bunting's legal representatives, KRW Law, claim that was an illegal move incompatible with her human rights.
During the closed session Mr Justice Scoffield will examine the sensitive material before deciding the next stage in the ongoing legal challenge.