Your A8 has 4 level sensors on all 4 corners of the car. Very easy to replace. My guess is that one. Check out the part first see if it's broken and look in VCDS to see what the read out is under Level Control.
Personally I would do this procedure:
http://www.ross-tech.com/vag-com/cars/levelcontrol.html
Let me know how you get on.