Water levels on toilet tanks are generally best at an inch or so below the overflow pipe. If the water is too high, it will run into the overflow pipe and waste water. Additionally, it will make an annoying running sound all the time. Many modern toilets have a coloured or moulded water level indicator marking. Most often the problem is the float ball, which is the mechanism that regulates tank fill ups. The tank ball floats on the surface of the water and when the toilet is flushed the sinking of the ball indicates that it's time to fill up.
Remove the tank lid and set aside. Adjust the float arm. If your toilet has a ballcock refill valve, water adjustment it simple. The float arm is what attaches the tank ball and it is bendable. Simply bend it slightly down to lower the water level or up to raise the water level. You will probably have to flush a few times to make certain there is enough water for proper action but no excess running noise. If the ball has no buoyancy, it needs to be replaced. The float arm can be replaced if it is damaged, too.
Turn the regulator nut or slide the pinch valve to change water level in a modern plastic refill valve configuration. The nut is at the refill valve's right next to the refill tube that goes into the overflow pipe. The direction that you turn or slide either device will determine if you are raising or lowering water level.
Check a few other parts of the toilet. The flush ball has a guide arm that should deposit the flush ball into its seat. There is a screw next to the guide arm that can be loosened so you can position the flush ball correctly and then tighten the screw to maintain the adjustment. The wires that lift the flush ball can also be bent for a higher or lower lift, which changes the water level.
Check the chain or hardware that holds the flapper up. The flapper is located at the very bottom of the tank and releases the water into the bowl to start the flushing action. If the chain is too long or too short the flapper will close too soon or be held open too long. One will not give you enough water for a flush and the other wastes water. It is simple to move the hook into a different link on the chain or hole in the hardware.
Adjust the refill tube. If it is angled into the tank, it is simply putting water in the tank. It is supposed to be positioned over the overflow pipe so the water goes into the bowl. Make certain the water level in the tank is not above the refill tube.