Alchemy was a quasi-science that centered on the inherent powers of the four elements: fire, water, earth, and air. The idea was that varying combinations of these 4 basic common materials would provide one the makings of any element in existence. Alchemy was first utilized in Khem, the ancient name for Egypt (Al-Kimiya), and although they are far removed in time and sophistication, and at the time didn't know it, practitioners provided the foundation for modern chemistry. Finally, chemistry replaced it completely, over a relatively brief time span, thanks to the intellectual tsunami that was the Renaissance.

     Of the more legendary aspects of Alchemy, the most common belief is that by mixing the proper materials in the right proportions and performing certain secret rituals, lead or any other metal could be turned into gold. Another prominent belief was that, in like manner the Philosopher's Stone, a mythical rock thought to possess the capacity to prolong the owner's lifespan, could be produced.

     At their developmental peak, alchemists were practicing a primitive form of chemistry. Like modern chemists, they were isolating and identifying elements and compounds, and learning and documenting how they interacted with each other. As scientific understanding grew it was realized that there was nothing magical or supernatural about the processes, but rather that they were natural chemical reactions which followed predictable natural laws. Hence, few people in modern times believe that lead can be turned into gold or that there is a mystical Philosophers Stone which can grant the holder great knowledge and power.

     One of the famous sayings of Alchemy is, Aurum Nostrum Non Vulgi (Our gold is not that of the common man); this refers to the idea that, at least for many Alchemists, it was more a spiritual search than a scientific one (although alchemists did make significant contributions to chemical knowledge). Alchemy reached its peak in Europe at a time when any religious dissent could get you into trouble with religious authorities. Particularly vulnerable, were those who felt that their spiritual development was their own personal business. Carl Jung, using alchemy as an analogy, identified it with his process of Individuation, and there are certainly similarities.

 

Source: http://www.alchemylab.com/what_is_alchemy.htm