Wash all parts separately. Depending on what kind of bottles you use, some brands (like Dr. Brown's) have several parts that need to be taken out of the bottle and taken apart for washing.
Use hot, soapy water. Rinse the bottles and attachments. Then fill the sink with hot water, and put in a drop or two of mild dish detergent (like Seventh Generation). You can then allow everything to soak in the soapy water for a bit.
Clean with a bottle brush. This allows you to get inside the bottle for a thorough cleaning. Unlike a sponge, the brush won't be used to clean anything else but baby's bottles.
Sterilize once. You need to sterilize bottles, nipples, rings, etc., only before the first use. The one exception: if you have well water. If that's the case, you might want to sterilize more often.
If you have a dishwasher: Rinse out the bottles and put them on the top rack of the dishwasher, with nipples and any other small attachments placed in a basket (sold at Babies R Us, Buy Buy Baby, and Target) on the top rack as well.