Drop Shadow Layer Effect
The Drop Shadow is probably one of the most used layer effects.
The Blend Mode allows you to blend the shadow into the background in different ways (Multiply, Overlay, etc.).
Lower the Opacity to increase the shadow’s translucence.
The Angle option of your drop shadow will affect the direction it drops when the Distance is set to 1 pixel or higher. If the Distance is set to 0, the shadow will spread equally around the layer’s contents.
Spread allows you to make the shadow thicker/denser.
The Size is how big or small the drop shadow will be on each side of the object.
Changing the Quality set of options enables you to add noise to your shadow and alter the contours of your shadow.
Drop Shadow Example 1
In this particular image, the direction of the shadow won’t matter because I had set the Distance option to 0, meaning that the shadow is centered. This can be used to bring images out of the background, and works especially well on light backgrounds (such as white or light gray).
Drop Shadow Example 2
This next example uses similar settings, with a slightly lower Opacity, and increased Distance, Spread and Size. As you can see, the drop shadow steers off below the bottom right side corner, giving the impression that there is a source of light coming from the upper left corner.