The chemistry set is something I hadn't really explored until this week. It was introduced with the Generations expansion pack, and can be found in Buy Mode under "Skills & Hobbies."

 

The chemistry set is a lab bench, and your Sim will change into a lab coat and goggles when they use it. I recommend putting a shower nearby, because your Sim will frequently set themselves on fire while using the set! If you have a shower handy, you can just take a quick shower and then get back to making potions. Otherwise you get a strong negative moodlet that sticks around for a long time, and prevents you from using the chemistry set while it is active. (The same is true for the Inventing workbench, by the way.)

 

Chemistry is a sub-set of the Logic skill. Your Sim will gain Logic while using the set, and the chemistry stats (like the number of potions discovered) will be listed under the Logic skill section. First your Sim has to "discover" potions (by mixing chemicals at random, apparently). Then they can make those potions as a second step. 

 

When you make a potion, it ends up in your personal inventory (backpack). You can drink it, give it to someone else - and, if you feel extra evil, you can even mix it into a drink to trick them into drinking it!

 

Frankly I am not very impressed with most of the potions that you can mix at the set. Most of them (like Stink Juice, Liquid Horror, and Bladder Flow) are just silly pranks. There are a few (like Sleeping Elixer and Radical Reparum) which are moderately useful, although I think the time spent making the potion probably cancels out any benefit you get from the potion itself.

 

But if you have been hankering for a ghost baby, the Ghost Potion is your ticket. When a Sim drinks the Ghost Potion, they turn into a ghost for a few hours. If they "Try For Baby" with a regular Sim, there is a chance that the product will be a ghost baby. (Presumably the same odds as Trying For Baby with a real ghost.)

 

Young Again and Imaginary Friend Metamorphium are definitely the most useful here. Young Again is the same potion that you can buy as a Lifetime Happiness Reward, but it costs 70,000 Lifetime Happiness points. It's much easier to just make it yourself!

 

The same goes for Imaginary Friend Metamorphium. If you want to make your Imaginary Friend real, then the chemistry set is definitely the way to go.