The all-party parliamentary group (APPG) for youth affairs will work with youth sector groups including the National Youth Agency to stage the inquiry, which will consider whether current youth work provision is sufficient to meet the needs of young people.
It is the first parliamentary inquiry into youth services and youth work since the education select committee looked at the sector in 2011.
Other issues being considered include the role of youth work in providing opportunities for young people and whether youth provision is addressing the issues and challenges they face.
It will also look at whether there are enough youth workers to support young people, the range of delivery models in the sector, and the training and development needs of youth workers.
"It is seven years since the last parliamentary inquiry into youth services and youth work," APPG chair Lloyd Russell-Moyle, who is Labour MP for Brighton Kemptown, said.
"Over the years youth work has borne the brunt of significant spending cuts. Recent events and reports suggest the loss of youth work has had a negative impact on young people and communities.
"In the face of rapid technological change and major economic and societal challenges we need to look again at what support young people need now and to meet their needs for the future."
Gillian Keegan, APPG vice-chair and Conservative MP for Chichester, said that there is currently a lack of clarity over how youth work can best support young people.
"Youth work can make a significant difference to the character, resilience and life skills of young people," she said.
"There is a rich history and some great examples of youth work across the public sector, voluntary, community and faith organisations. This includes social action projects and national programmes supported by business and social enterprise.
"Yet we lack a coherent approach to secure and sustain youth work, and a proper understanding of the levels and extent of youth work needed to achieve the best outcomes for young people."
NYA chief executive Leigh Middleton added: "It is important to understand how youth work has adapted to the modern world understood by young people, commissioners and funders alike."
The APPG is inviting submissions to the inquiry until 27 June and will stage parliamentary hearings as well as visiting youth services and projects over the summer.