The important thing is to remain calm and not use any crude or unnecessarily accusatory language. If I see someone drop something, I'll usually pick it up and present it to them with a nonchalant, "Excuse me sir/mam, you dropped this." I've found this often leads, especially if there are many other people around, to a sheepish acceptance of the improperly discarded item. So, with calm and nonchalance, you provide them with an opportunity to right their wrong without being explicitly didactic or condemnatory.

If they happen to respond somewhat combatively, with say, "No, I didn't" or "Yea, it's garbage" then you might say, "The street is not a refuse receptacle. Please dispose of your waste properly." To one particularly abrasive man who continually asserted his righteousness in sullying the public landscape I said, "So you are knowingly and willfully breaking the law and subjecting all of us to your filth?" At that, he brusquely took his cigar stump from my hand and stormed off cursing.

Of course, it should be noted that one must be circumspect when entering into any confrontation. As should be clear, one should treat it as any other encounter with a stranger so far as ensuring your physical safety.