Martelli returned to politics in 1997 and re-founded Mondoperaio, a PSI-affiliated cultural magazine, and joined the Italian Democratic Socialists (SDI), becoming in 1999 a Member of the European Parliament (MEP), a position he first held with the PSI between 1984 and 1989.

In 2001, he joined the centre-right coalition-affiliated New Italian Socialist Party (NPSI) and unsuccessfully ran for the Chamber of Deputies, a position he also held with the PSI from 1979 to 1994.

His candidacy was blown off by his involvement in the 7 million dollar bribe in 1980 and resigned as Minister of Justice.

[1] In the Tangentopoli scandal, regarding the illicit financing of the PSI, Martelli was sentenced to 8 months in prison in 2000, suspended on probation, after confessing, for having received ₤500 million in the case of the Enimont maxi-tangent.

[3] According to court documents, Roberto Calvi paid bribes to Martelli during the Banco Ambrosiano affair; however, he was not convicted in this case.

He said: "In the list of people to kill, as I learned from Salvatore Biondino, the ambassador of the commission, there were Lima, Andreotti and his son, the former ministers Mannino, Vizzini, but also Martelli.