Plaster of Paris is the common name for calcium sulphate hemihydrate, with the chemical formula CaSO₄·½H₂O. It is manufactured by heating gypsum, which is naturally occurring calcium sulphate dihydrate (CaSO₄·2H₂O), at a moderately low temperature (around 120–150°C). At this temperature, gypsum loses three-quarters of its water of crystallisation without decomposing further, according to the reaction:

CaSO₄·2H₂O (gypsum) --heat--> CaSO₄·½H₂O (Plaster of Paris) + 1½ H₂O (released as steam)

If gypsum is heated to a much higher temperature instead, it loses all of its water of crystallisation to form anhydrous calcium sulphate (CaSO₄, sometimes called "dead burnt plaster"), which does not readily reset with water and is therefore not useful as Plaster of Paris.

The defining and most useful property of Plaster of Paris is that when it is mixed with a suitable amount of water, it undergoes a reverse reaction — it re-absorbs the water molecules it had lost and slowly recrystallises back into gypsum (CaSO₄·2H₂O), a process called "setting." This setting reaction is mildly exothermic (it releases a small amount of heat) and involves a slight expansion in volume, which allows the plaster to fill moulds completely and take a sharp, accurate impression of any surface it is cast against. These properties make it extremely useful for making orthopaedic casts for broken bones, moulds and sculptures, decorative ceiling and wall designs, and as a component of blackboard chalk and some cements.

The remaining substances listed do not yield Plaster of Paris on heating: calcium hydroxide (slaked lime, Ca(OH)₂) is itself produced by adding water to calcium oxide (quicklime) and is used in whitewashing and mortar, not in making Plaster of Paris; sodium chloride (common salt) is chemically unrelated to calcium sulphate chemistry and heating it does not produce any plaster-like compound; and calcium carbonate (limestone, CaCO₃) when strongly heated undergoes thermal decomposition to give calcium oxide (quicklime) and carbon dioxide, which is an entirely different chemical process (used in cement and lime manufacture) and does not yield Plaster of Paris. Hence, gypsum is the correct starting material for the preparation of Plaster of Paris.