Ofqual said it would gather evidence and listen to views in what it described as an "objective and constructive debate" on the issue.
GCSE results have been rising for more than 20 years, and 27% of A-level students received As or A*s last year.
Education Secretary Michael Gove has made it clear he wants exams to be rigorous and demanding.
Ofqual spoke out as this year's exam season gets under way, with 800,000 pupils across England, Wales and Northern Ireland revising for their GCSE and A-level exams.
'Firm but fair'Ofqual's new chief executive Glenys Stacey told the Daily Telegraph: "We do a lot of work to maintain standards on all the key qualifications across the board on subject matters and subject levels.
"But there is still a public concern over standards and a feeling that things aren't what they used to be.
"Well, I would like to understand that better and actually bring some evidence to the debate as well. I want an objective and constructive debate."
She said her investigation would be "firm but fair".
An Ofqual spokesman said that in the past the watchdog had focussed on the technical standards of individual exams.
However it now wanted to draw all the evidence together because it was aware of a public perception of falling standards.
Ofqual will also look at competition between exam boards and the use of modular exams - where exams are broken down into smaller units. This often leads to a high number of re-sits.
International comparisonsA number of studies have suggested exams are getting easier, and there have been attempts to tighten standards up by reducing the amount of course work.
Mr Gove has already called for exams taken in England to be compared with tests taken in other countries and has asked Ofsted to run a separate inquiry into standards in vocational exams.
The Department for Education did not wish to comment on Ofqual's plans.
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