The university's Ian Ramsey Centre for Science and Religion will bring together anthropologists, theologians, philosophers and other academics for a three-year study on whether belief in a divine being is an inherent part of mankind's makeup.
"We are interested in exploring exactly in what sense belief in God is natural," said Justin Barrett, a psychologist and leading member of the research team, according to the Church of England Newspaper. "We think there is more on the nature side than a lot of people suppose."
The researchers will develop a "scientific approach" to why mankind believes in God and other issues around the nature and origin of religious belief. The study will also look into which religious beliefs are most common and most natural for the human mind to grasp.
Roger Trigg, acting director of the Ian Ramsey Centre, said anthropological and philosophical research suggests that faith in God is a universal human impulse found in most cultures around the world, even though it has been waning in Britain and parts of Europe, according to The Associated Press.
"There are a lot of issues. What is it that is innate in human nature to believe in God, whether it is gods or something superhuman or supernatural?" he asked. "One implication that comes from this is that religion is the default position, and atheism is perhaps more in need of explanation."
The study comes as many Christians in the West feel there is growing hostility towards Christianity in the public square. Outspoken atheists Richard Dawkins and Christopher Hitchens have come out louder in recent years, arguing against the Christian faith and encouraging other atheists to come out of the closet.
Researchers of the Oxford study will not attempt to answer whether God exists but they will examine evidence to try to prove whether belief in God conferred an evolutionary advantage to mankind, according to The Times.
The study will be funded by the John Templeton Foundation, a US-based philanthropic organisation that funds wide-ranging research into questions that deal with the laws of nature and issues of spirituality.