Members of an IRA unit shot dead in an SAS ambush 31 years ago had been under military surveillance for weeks, the High Court heard.
Counsel for the father of one of the eight republicans killed at Loughgall, Co Armagh claimed sensitive new material revealed the extent of the army operation.
Relatives of the dead men and legal representatives later alleged the disclosure proves their deaths could have been prevented.
Solicitor Claire McKeegan said: "This information is a huge development in the proceedings."
Undercover soldiers opened fire as members of the IRA's East Tyrone unit approached Loughgall police station with a bomb in a hijacked digger in May 1987.
The republicans killed were: Jim Lynagh, Padraig McKearney, Gerard O'Callaghan, Tony Gormley, Eugene Kelly, Patrick Kelly, Seamus Donnelly and Declan Arthurs.
An innocent civilian, Anthony Hughes, was also shot dead after he unwittingly became caught up in the gunfire.
The military operation inflicted the IRA's single largest loss of life during the conflict.
Relatives of those killed claim soldiers operated a deliberate shoot-to-kill policy rather than attempt to make arrests.
Declan Arthurs' father, Patrick, is suing the Ministry of Defence (MOD) over the ambush.
With a Royal Ulster Constabulary mobile support unit also believed to have played a role in the operation, the legal action was widened to include a claim against the Chief Constable.
Sensitive and redacted documents have now been disclosed by police as part of the litigation.
Updating the court today, Mr Arthurs' barrister, Hugh Southey QC, said it revealed an SAS operation had been watching those who ended up dying for a number of weeks prior to events on the day.
Following submissions Mr Justice Maguire listed the case for a further review next month.
Outside court Ms McKeegan, of KRW Law, claimed the new material from the PSNI "proves that the security services not only could have prevented the ambush but that the MOD have not been up-front in relation to their disclosure obligations in this case".
She also expressed concern that previous disclosure from the MOD made no reference to SAS surveillance of the IRA men in advance of the shootings.
"This further highlights the need for the fresh inquests and the need for the money to be released from the Government immediately so that all victims of the conflict can obtain the answers that they so greatly need and deserve."
Mairead Kelly of the Loughgall Truth and Justice Campaign said: "It has long been suspected by the bereaved families of Loughgall that the SAS shoot-to-kill operation did not have to happen.
"This recent raft of discovery shows that the state authorities had sufficient information to effect arrests long in advance but instead undertook a premeditated shoot-to-kill strategy."