The investigation comes after Jason Huntley, a 45-year-old IT consultant in Britain, detailed in his blog how his LG smart TV logged the channels he was watching and sent the data to LG.
He said the company continued to collect which channel he was watching even after he disabled the information collection feature.
"The (LG) server acknowledges the successful receipt of this information back to the TV," he said in an email. The information appeared to be sent to LG unencrypted, he said.
Also collected were the names of files saved in an external USB hard drive plugged into the TV as well as the TV's unique identification information.
The world's second-largest TV maker said Thursday that customer privacy is its top priority and takes the issue very seriously.
However, when Huntley asked LG about the data collection last week, the company blamed a TV retailer for not disclosing the company's terms and conditions when he made the purchase.
"As you accepted the Terms and Conditions on your TV, your concerns would be best directed to the retailer," LG said in an email to Huntley that outlined the response from the company's U.K. head office.
LG introduced an ad platform to target its smart TV users in 2012. The LG Smart AD lets advertisers reach target audiences by utilizing device information, location and details such as age and gender, LG says on its website.
However it was not immediately clear which features in LG's smart TVs were triggering the data monitoring.
"All we can be sure of is that the information is being sent," Huntley said.
He said was "very surprised" at the amount of attention he received with the blog post.
"This indicates that privacy issues are becoming increasingly important to people everywhere, as we are so dependent on technology in our everyday lives."
Separately, Samsung Electronics Co. said it does not collect information on files in USB hard drives connected to its smart TVs. But it did not respond to a question about whether it logs users' viewing habits. Samsung is the world's largest TV maker.