Minister for Justice Alan Shatter has apologised on behalf of the Government to the families of Chief Superintendent Harry Breen and Superintendent Bob Buchanan.
The RUC officers were shot dead by the IRA shortly after leaving Dundalk Garda Station in 1989.
Mr Shatter told RTÉ’s Six One News that it is a matter of the utmost gravity that Mr Justice Peter Smithwick has concluded that an unidentified member or unidentified members of the gardaí, at Dundalk Garda Station, colluded with the IRA, resulting in the death of two respected RUC officers.
Mr Shatter said that the Government will give very careful consideration to the series of recommendations with regard to matters that are of relevance to policing for both the PSNI and An Garda Síochána.
The minister said it was unfortunate that members of the IRA who had met with the Tribunal team had failed to make themselves available to give evidence to the Tribunal.
He said it was very important to remember that the murders that took place were undertaken by members of the IRA and that they bear the responsibility.
However, he said that it is not acceptable in any circumstances that a member of An Garda Síochána colludes with a subversive organisation.
Mr Shatter said that in the immediate aftermath of the killings, both the RUC and the gardaí discounted the possibility of there being collusion.
He said that he believed that today, such allegations would be taken seriously.
The minister said it is very important to acknowledge that there are individuals still engaged in subversive activity on this island and that the gardaí and the PSNI have been very successful in working together.
Tánaiste Eamon Gilmore said he was appalled and saddened by the finding of collusion and described it as a matter of grave public concern.
Mr Gilmore, on behalf of the Government and people of Ireland, apologised without reservation to the Breen and Buchanan families.
He said members of An Garda Síochána will be shocked by the findings and the "actions documented in this report are a betrayal of the values and the very ethos of an Garda Síochána, as the guardians of peace".
Reacting to the tribunal findings, Supt Buchanan's son William said: "The findings are both incredible and shocking and confirm the existence of a mole in Dundalk station. This led to my father's death."
Mr Buchanan added: "I, on behalf of the Buchanan family, wish to place on record our appreciation for the diligence and integrity of Judge Peter Smithwick and his team.
"They have been untiring in the performance of their task and we trust the State will take cognisance of the findings and learn valuable lessons for the future."
The family of Harry Breen have said all their fears have been realised by the tribunal's devastating findings.
Lawyers for the family said the findings of garda collusion are a truly remarkable exposé and indictment of wrongdoing.
They said the officer and his trusted colleague Supt Buchanan were betrayed by their counterparts in the gardaí.
Solicitor John McBurney said: "It is tragic that he was betrayed in the manner established by Judge Smithwick whilst he was engaged in significant policing endeavours of importance to the RUC and An Garda Síochána and the jurisdictions both served."
Garda Commissioner Martin Callinan has welcomed the publication of the report.
However, in a statement, he said that given the serious matters under examination, the report, its conclusions and recommendations need to be carefully examined.
The Commissioner said it would be inappropriate to comment further at this stage.
Sinn Féin president Gerry Adams said: "The Smithwick Tribunal was established as a result of an agreement in negotiations in Weston Park in 2001 between the British and Irish governments and the political parties.
"Sinn Féin supported the establishment of a series of inquiries, including the Smithwick inquiry, and in a significant and unprecedented development three former IRA Volunteers gave evidence to it.
"Justice Smithwick accepts much of the evidence given by the former IRA volunteers but on the basis of evidence provided by others, including the PSNI and former informers, concludes that while the Tribunal 'has not uncovered direct evidence of collusion' that 'on balance of probability' some form of collusion occurred.
"People will make up their own minds on this when they read the report."
Northern Ireland's Justice Minister David Ford said: "A rogue officer acting outside the law should not result in the loss of trust between the PSNI and An Garda Síochána.
Northern Ireland Secretary of State Theresa Villiers said she will raise the findings of collusion with the Government.
"An important point to remember is that levels of co-operation between An Garda Síochána and the PSNI are now at unprecedented levels and are playing a crucial part in combating terrorist attacks in Northern Ireland," she said.
Ms Villiers also paid tribute to the two senior officers and their families.
She said: "They were two brave police officers dedicated to upholding the law and protecting the community from terrorism.
"The publication of the report will be very difficult for their families."
Ulster Unionist MLA Tom Elliott said the tribunal is confirmation that successive Irish governments did not do enough to stop the IRA.
SDLP policing spokesperson Dolores Kelly said that the fearless approach of Judge Smithwick is a measure of how to deal with the past.
She said: "The SDLP accept the findings of the Smithwick Tribunal and in doing so would like to acknowledge the bravery and persistence of the Breen and Buchanan families.
"The Smithwick Tribunal took an independent and fearless approach and this should be a measure of how to deal with the past. Judge Smithwick, through a trying process and painstaking work, has gotten to the bottom of this tragedy."
Democratic Unionist MP Jeffrey Donaldson said the findings of the report had major implications for the Haass talks process aimed at resolving Northern Ireland's difficult issues.
"I believe that the finding of collusion on the part of the garda with members of the IRA is significant and has major implications for the way in which we deal with the past under the current talks process being overseen by Dr Richard Haass," he said.
"While the report does not identify those garda officers responsible, those people know who they are and if they do not face justice in this world they certainly will face it thereafter."
Fianna Fáil justice spokesperson Niall Collins TD said: "While I have only received the report this evening, even a quick analysis of the main conclusions makes for very difficult reading.
"The clarity of the report vindicates the decision of the previous government to establish the Tribunal.
"It also throws into sharp relief the ongoing failure of the British government to honour its commitments to hold a number of other inquiries agreed at the Weston Park talks."