Often when a site loses its search rankings suddenly, a webmaster may not know the cause. It could be that the site has been penalized by Google for questionable linking practices or on-site tactics, or it could be increased competition. To guide webmasters through the process, Rand Fishkin at SEOmoz has created a flowchart describing How to Handle a Google Penalty.
It’s based on his experience, as well as on conversations with Matt Cutts, which means its not an official Google document, but it does offer some useful guidance.
The process involves checking to see if your site is still indexed; if it ranks for its domain name; or if it ranks for unique terms in title tags. In each case, Fishkin offers a possible explanation other than a penalty and recommended course of action.