battery problem?

Using WinXP. I have a 3.5-year-old Dell laptop as my main computer. I turn
it off and unplug it at night but leave it on and plugged in all day.
Lately, I find that in the evening the power indicator in the system tray
shows that the battery is charging. When I hover the mouse over the icon, it
says 98 or 99 percent charged. Eventually, it finishes charging and goes
back to the AC power icon. It never indicates charging when I first plug the
computer in and turn it on in the morning.

Is this likely to be a battery problem? What should I do next?

Thank you!

Jo-Anne