What he said. Mine was dead when I first got the bike. The wire from the regulator should be carrying 7 volts. If it's carrying more, your gauge will read high. And if the regulator is putting out 7 volts as it should, make sure its output wire is actually connected to the gauge. On mine it wasn't; hence the dead gauge. Of course, if the regulator isn't putting anything out, then you need to look at its input wire: it needs 12 volts or there won't be correct output. If it has 12 volts going in and nothing coming out, the regulator is the problem. But my regulator had 12 volts in/7 volts out just as it should. It just didn't have a complete circuit to the gauge.
The temp gauge has two wires running to it on my GL: a green/blue runs from the temperature sensor and a yellow runs to the 7 volt regulator. My regulator and connection were both found in the tangle of wires either in my headlight bucket or just outside the bucket in the hole the wires run through to the rest of the bike. It's a small flat looking black gadget with three wires running to it: a black/brown (12v in), a yellow (7 v out to your gauge) and a green (I assume the ground).
It's amazing how well it's worked since I actually connected the gauge to its power supply.