It is very important to report your passport lost or stolen immediately. This will protect you from identity theft. Once you reported it, the passport becomes invalid and can no longer be used for international travel. You have 3 options, that are listed below.
If you plan to replace your passport, you will be required to fill out Form DS-11 in person. If you are currently inside the US and plan to travel within the next 2 weeks or less, you will then need to make an appointment to apply in person at one of the passport agencies. If you are in the US and do not plan to travel within the next 2 weeks you will need to make an appointment with one of the passport locations near you. If you are currently outside the US then you would need to contact the nearest US embassy or consulate to get a replacement passport.
If you have not received your passport and believe it may have been lost in the mail then the first step is to confirm they mailed your passport. To find the status you can use their online passport status system or you can contact the National Passport Information Center (NPIC). If it's been 10 days or more since they mailed you your passport, then they suggest you contact NPIC. If you have not reported this within 90 days of when the passport was issued, you will be required to re-apply and will have to pay the application fees again.
If you have a decease relative and wish you cancel their passport, you can mail it in. Once they receive it and cancel the passport, they can return it back to you. They require you submit the valid passport, a certified copy of the death certificate and a letter requesting the cancellation and return of the passport. The address to mail the passport for cancellation is:
U.S. Department of State
Consular Lost and Stolen Passport Unit (CLASP)
CA/PPT/S/L/LE/CP
44132 Mercure Circle
P.O. Box 1227
Sterling, VA 20166-1227
If you happen to come across someone else lost passport, they recommend you mail it in using a sturdy envelope to the following address:
U.S. Department of State
Consular Lost and Stolen Passport Unit (CLASP)
CA/PPT/S/L/LE/CP
44132 Mercure Circle
PO Box 1227
Sterling, VA 20166-1227