(Reuters) - The top U.S. consumer product safety regulator is reviewing whether to recall widely sold toy jewelry-making kits after a New York state probe determined that the products contain dangerously high levels of lead.

Elliot Kaye, who chairs the U.S. Consumer Product Safety Commission, said on Friday that he is examining the safety of Cra-Z-Art kits after New York Attorney General Eric Schneiderman called on several big retailers to pull them from store shelves.

The attorney general said sets that his office tested included wristbands with lead levels as high as 980 parts per million, far exceeding the 100-part federal limit for children's products.

He said he sent letters to Amazon.com Inc, Sears Holdings Corp's Kmart, Target Corp, Toys "R" Us, Wal-Mart Stores Inc and other retailers, demanding that they stop selling and recall the sets, which his office said were made in China.

A similar demand was made to LaRose Industries LLC, a Randolph, New Jersey-based company that distributes Cra-Z-Art.

"Just hours after receiving information about these jewelry making kits, CPSC staff opened an investigation into the safety of these products," Kaye said in a statement. "CPSC's investigation will be thorough and swift, and we will certainly take all warranted steps to protect the public."

The commission typically works with companies to arrange voluntary recalls and can file lawsuits if that cannot be accomplished. Schneiderman cannot order a nationwide recall.

LaRose did not immediately respond to a request for comment.

Wal-Mart said it requires suppliers to meet "all applicable" standards, and that "out of an abundance of caution, we are removing these items from our stores and online inventory."

Toys "R" Us, also citing caution, said it is "working to pull the items from our stores and website."

Kmart said it would cooperate with the attorney general and is committed to safety. Target said it is reviewing the matter, and is also committed to safety. Amazon did not immediately respond to requests for comment.

The 10 Cra-Z-Art sets that were tested had been purchased at nine Kmart, Target and Toys "R" Us stores in New York.

The products include Shimmer N' Sparkle Cra-Z-Art Cra-Z-Jewelz Gem Creations Ultimate Gem Machine, Shimmer N' Sparkle Cra-Z-Art Cra-Z-Jewelz Gem Creations Gem Charm and Slider Bracelets, and My Look Cra-Z-Art Cra-Z-Jewelz Gem Creations Ultimate Gem Machine.

(Reporting by Jonathan Stempel in New York; editing by Lisa Von Ahn and Cynthia Osterman)