The inquiry will be conducted by a retired judge of the Orissa High Court and completed within three months, a statement from the Chief Minister's office said.
The decision was taken when Law Minister Pratap Jena met Mr Patnaik at the state secretariat to discuss the issue.
The judicial probe will find out the circumstances leading to the treasury keys going missing and more steps will be taken after the probe is over, said Mr Jena.
The missing keys of Ratna Bhandar (treasury) had drawn flak, with Puri Shankaracharya Swami Nischalananda Saraswati of Govardhan Peeth having demanded a probe into the case.
At a meeting of the Sri Jagannath Temple Managing Committee on April 4, it was recorded that the keys to the treasury had gone missing.
A 16-member team had on April 4, entered the Ratna Bhandar after 34 years to inspect its physical conditions following an order of the Orissa High Court. However, they could not enter the inner chambers because they did not have the keys. They returned after completing the inspection of outer chambers, sources added.
Meanwhile, the Congress took a dig at the state government over the missing key issue.
"Judicial inquiry is restricted to announcement only as the mandate of the commission is not clear. This is an attempt to divert attention from core issue," said Pradesh Congress Committee (PCC) President Niranjan Patnaik