The water level in your toilet tank is more important to the operation of the toilet than you might suspect. If it's too high, you'll have a runny toilet, including possible leaks from the handle and wasted water; it it's too low, the toilet won't flush properly. The optimum water level is about an inch below the opening of the overflow tube, and you regulate that by adjusting the float of the fill valve.
Fill Valve Styles
The 1992 Energy Policy Act mandated water savings by requiring toilets to flush with a maximum of 1.6 gallons of water. In their efforts to design water-saving toilets, manufacturers changed the design of the ballcock-style fill valves that were the standard before implementation of the act. The float on older ballcock valves consists of an air-filled ball attached to the end of a metal armature, whereas the one on newer Fluidmaster-style valves is typically a plastic cup that slides up and down the valve stem. The procedures for adjusting these two types of valves are slightly different:
Adjusting a Ballcock Float
Note the bend in the armature that connects the ball float to the valve. To lower the water level, rotate the armature so this bend is closer to the top of the tank. This action places the ball lower in the tank and forces the fill valve to close sooner.
Screw the ball counterclockwise -- as seen from the front of the ball relative to the valve -- to lengthen the armature. This also has the effect of forcing the valve to close sooner and lower the water level. Screw the ball clockwise to raise the water level.
Turn the screw on the top of the valve with a screwdriver to adjust the sensitivity of the valve. Rotating the screw clockwise closes the valve, which makes it close sooner and lowers the water level. Rotating it counterclockwise has the opposite effect.
Adjusting a Fluidmaster-Style Float
Locate the adjustment rod. It's usually made of plastic and can be clear, black or another color. It's on the side of the valve and connects the float to the top of the valve.
Turn the screw on the top of the adjustment arm with a screwdriver. Turning it clockwise shortens the length of the rod and turning it counterclockwise lengthens it. Some cup-style floats have a simple plastic connecting armature that snaps onto the float. Pull it off, move the float up or down and reconnect it. Other models have a thin metal rod that connects to the float via a flexible metal clip. To adjust, pinch the clip and slide it up or down on metal rod; the float moves with it.
Lengthen the rod to lower the water level and shorten it to raise the water level.
Adjusting the Height of a Fluidmaster-Style Fill Valve
If you can't adjust the float properly, you may be able to adjust the water level by altering the height of the fill valve. Whoever installed the fill valve had to set this height, and you can't change it if you see a whitish lock ring below the float cup. If you don't see that ring, follow the manufacturer's instructions -- available on its website -- for adjusting the height. It usually involves unlocking the top cap with a twist of your hand and turning the upper part of the valve clockwise to raise it. Be sure to remove the overflow tube before you do this.