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In Photoshop it is part of the layer properties. You need to make your canvas size slightly larger than your image size, to allow room, then double click on the layer and tick the drop shadow option.
There are lots of ways you can vary the shadow, the best way is to play around.
If you don't have PS I can't help sorry.
Ian
In Elements 5, in Editor, open up "Artwork & Effects" in the pallette bin, third icon along, "Special Effects", there are two drop down boxes.
In the left one click on layer styles, in the right one click drop shadows.
Apply the one you want and a little "sunflower" will appear on the layer detail.
If you double click on this, you can tailor the effect to suit.
As Ian said above, you will need to increase the canvas size to see the effect.
HTH.
Martyn
Quote: You may also wnt to add the drop shadow effect to the image before you resize it otherwise, it will increase the image size to cater for the extra border.
That doesn't sound right. Increasing the canvas size doesn't touch the image size. The drop shadow goes into the gap between image edge and canvas edge.
If you change the image size after adding the drop shadow it does not change the drop shadow properties, unless you have flattened everything, which effectively builds the drop shadow into the image (I think). Not at my home PC so can't test it out.
Ian,
What I was trying to say was that, if you have resized your image to 600x600 for submission here and you then added a drop shadow effect, or resize the canvas, you image will now be 610+x610+ which is outside the upload size for this site. Therefore add any effect, which may alter the size, and then resize the image.
I know when I tried adding something like a drop shadow, via Elements 3, to a 600x600 image the number of pixels was increase to cater for the extra border.
Having said that, that may be a feature of the Frames within Elements 3 and not Layer Styles where you select the area first I think.
Simon
Ah right, got you. Yes you need to add your drop shadow before resizing for here. 
No problem, glad you worked it out. While you are in there you may want to play around with the other layer properties.
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