In the episode, Clarkson had put up the placard during a challenge in which the presenters had to race 1980s hatchbacks, and he and James May were ridiculing Hammond's choice of a Vauxhall Nova.
The Ofcom investigation into whether the potential for offence caused by the use of the word "pikey" was justified by the context began in April, after details of the BBC Trust ruling were released in March.
The BBC Trust had acknowledged that the word "pikey" derived from "turnpike" and so related to Travellers, but its Editorial Standards Committee said there had been "no intended racist reference" by the Top Gear team.
The ruling stated: 'The committee believed the word "pikey" had evolved into common parlance among a number of people to mean "chavvy" or "cheap" and ... viewers would not necessarily associate it with the Gipsy and Traveller communities.'
A spokesman from Traveller Movement told MailOnline the charity welcomed Ofcom's decision to investigate the episode.
"The BBC Trust ruling was absurd when it ruled that the Top Gear use of the word 'pikey' had nothing to do with Gipsies and Travellers and meant cheap and dodgy instead," he said.
"Seeing as the word had been used by Clarkson and his crew in the past alongside a reference to selling pegs and heather, it is clearly the Trust that is being a bit cheap and dodgy.
"We believe in freedom of speech, but with that freedom there must be responsibility. The BBC Trust abdicated that responsibility when legitimised the use of a racist word on one of their most popular and money-spinning programmes.
"We can bang on about semantics and meanings but at the end of the day too many Gipsies and Travellers hear that word in the form of racist abuse.
"How can you work for understanding and integration when racist abuse is seen as funny by a national public broadcaster paid for by the public?
"We hope that the Ofcom investigation is thorough. This is clearly a topic that needs some attention, particularly with the often mocking and derogatory TV fascination with all things Gipsy."
A spokesman for Top Gear declined to comment on the Ofcom investigation.
It is not the first time the controversial motoring show - and its former presenters - have run into trouble.
Clarkson had to apologise when unscreened footage emerged of him mumbling the n-word while reciting the children's nursery rhyme "eeny, meeny, miny, moe" to choose between two cars and the show was also censured by Ofcom for breaching broadcasting rules after Clarkson used a "racial" term when he said: "That is a proud moment, but there's a slope on it", as a man walked towards them on their makeshift bridge over the River Kwai during the programme's Burma special.
Last year ended with the motoring show's crew forced to flee Argentina when it emerged they were using a Porsche with the registration number H982 FKL, which some people suggested could refer to the Falklands conflict of 1982.
- Daily Mail