The caps lock on your keyboard may be stuck.
If the problem persists after you have ruled this out, reset the type tool. To do this, click on the little arrow or icon (depends on version) on the tool's option bar, top left, and reset the tool.
If this does not correct it, reset preferences.
Some fonts are only capitals. Does this happen on all fonts? Is this only happenning in PSE?
Thank you! It works now.
You're welcome. Glad to help.