I’ve written an article about this at searchengine-weblogs.com I am the editor of that SEO blog so please feel free to visit that site and read more about SEO and what it can do for you and your search engine rankings.

As a quick summary of the article, here’s a snippet on what might have caused the drop.

There are numerous reasons why your site dropped in search engine ranking. Reasons include change in search engine ranking algorithm, loss of PageRank or link popularity, bad or broken links, search engine penalty, and the missing www’s syndrome (incorrect url).
Another is that your competitors continue doing SEO on their sites which is why your site is going down the SERPs. Sometimes, there isn’t anything wrong with your site. It is just that your competitors are moving ahead, leaving you behind.