Boss and drops/drop rate

You are guaranteed a rare drop from all bosses on your first time killing each boss on normal difficulty. As of the 1.05 patch, you get "improved loot" for the first kill of a boss on every difficulty (its not clear exactly what this equates to yet). The intention isn't to allow players to farm, but to allow them to acquire enough gear to survive going forward.

After your first time on each boss, the only way to increase drop rate is through magic find and the Nephalem Valor buff