WASHINGTON (AP) _ Navy investigators conducted a thorough criminal probe of the explosion aboard the USS Iowa and properly investigated allegations of homosexuality involving sailors Clayton Hartwig and Kendall Truitt, the Pentagon's inspector general said in a report Wednesday.

''The Naval Investigative Service did not malign the character of Hartwig or Truitt,'' Inspector General June Gibbs Brown said in a report sent to Navy Secretary Lawrence Garrett III.

Miami defense attorney Ellis Rubin, who represents Truitt, called the report ''a perfect example of one branch of the government covering up and whitewashing another branch of the government. This whole Iowa investigation has been one Watergate piled on top of another.''

Ms. Brown conducted a review of the investigative techniques and procedures used by the Naval Investigative Service after allegations last summer by Truitt and by Hartwig's family that the NIS had mishandled the investigation and leaked damaging allegations to the news media.

NIS officials assisted Rear Adm. Richard Milligan in his four-month investigation into the blast that claimed 47 lives aboard the battleship on April 19. The investigators were brought in after suspicions of possible suicide or homicide arose.

Milligan cited Hartwig as the most likely person to have caused the explosion, saying he apparently placed some type of detonator between gun powder bags. He said Truitt, who survived the blast in the lowest level of the gun turret, had no link to its cause.

Ms. Brown review found ''the NIS investigation was thorough, complete and expeditious,'' and that it was proper for special agents to investigate allegations of possible homosexuality in the case, even though no such activity was ever proven.

While she said her office did not attempt to find the source or sources of the news leaks, ''it is possible'' that a source inside the NIS leaked information about the probe.

But Ms. Brown said it also appears likely that Navy officials who were being briefed about the case could have been sources, since the leaks started after the staff of the vice chief of naval operations and Milligan's inquiry team were briefed.

''The leaks stopped after NIS stopped briefing Navy management and started again after dissemination of investigative reports,'' Ms. Brown wrote.

The inspector general said that ''some of the leaks may more properly be described as good investigative journalism,'' but not all of them could be put in that category.

Hartwig's family has charged the Navy with using the sailor as a scapegoat and has sought a congressional investigation into the Navy's report.

Kathleen Kubicina, Hartwig's sister, said shortly after Milligan's report was released that the family planned to file a defamation of character lawsuit against the Navy for alleging Hartwig may have caused the explosion.

Truitt said the Navy slurred his reputation and his lawyer has said the service apologized to him for leaking false information.

But Ms. Brown said NIS agents ''did not apologize'' to Truitt.

''All logical investigative leads were covered, including those that required examining the backgrounds of persons closest to the explosion,'' said Ms. Brown, who holds the post of inspector general, which is supposed to act as an independent watchdog over an agency.

Ms. Brown said Truitt was investigated because of ''a possible motive for homicide,'' which arose after Hartwig's sister wrote a letter to the Iowa's commander complaining that her late brother had made Truitt the sole beneficiary of a life insurance policy.

''Homicide, suicide and human error were all obvious theories that had to be explored. The homicide theory was short-lived. Truitt was never a definitive homicide suspect ... The NIS case agents did not apologize to Truitt. During a follow-up interview, they informed him that he was no longer under suspicion,'' Ms. Brown wrote.

Rubin commented, ''One good thing has come out of the inspector general's report: For the first time, an officer of the U.S. government has admitted that Ken Truitt had nothing to to do with the explosion.''

''We're also going to file extensive lawsuits against those media outlets that initially carried the defamatory accusations that Truitt was a homosexual involved in a murder-suicide plot.''

Hartwig's sister commented: ''If the procedures the NIS used were correct, then I pity the U.S. Navy. I take personal offense the the fact the the NIS spoon-fed their allegations to the FBI and asked for a psychological profile that they themselves built on rumor, innuendo and allegations. ... They brow- beat until they got the response they were looking for.''

The inspector general said, ''Several witnesses, including members of Hartwig's family, raised the possibility of homosexuality on the part of Hartwig ... The NIS had no choice but to explore the issue as a potential motive in the incident. To neglect that investigative lead would have been derelict.''

''The NIS report offered no opinion about the homosexuality issue. While witness statements alluded to possible homosexuality, the NIS investigation did not confirm it and the report did not claim that either Hartwig or Truitt were-are homosexual. The NIS did not malign the character of Hartwig or Truitt,'' Ms. Brown said.