A designer drug is a structural or functional analog of a controlled substance that has been designed to mimic the pharmacological effects of the original drug, while avoiding classification as illegal and/or detection in standard drug tests. Designer drugs include psychoactive substances that have been designated by the European Union, Australia, and New Zealand, as new psychoactive substances (NPS) as well as analogs of performance-enhancing drugs such as designer steroids.

Some of these designer drugs were originally synthesized by academic or industrial researchers in an effort to discover more potent derivatives with fewer side effects and shorter duration (and possibly also because it is easier to apply for patents for new molecules) and were later co-opted for recreational use. Other designer drugs were prepared for the first time in clandestine laboratories. Because the efficacy and safety of these substances have not been thoroughly evaluated in animal and human trials, the use of some of these drugs may result in unexpected side effects.

The development of designer drugs may be considered a subfield of drug design. The exploration of modifications to known active drugs—such as their structural analogues, stereoisomers, and derivatives—yields drugs that may differ significantly in effects from their "parent" drug (e.g., showing increased potency, or decreased side effects). In some instances, designer drugs have similar effects to other known drugs, but have completely dissimilar chemical structures (e.g. JWH-018 vs THC). Despite being a very broad term, applicable to almost every synthetic drug, it is often used to connote synthetic recreational drugs, sometimes even those that have not been designed at all (e.g., LSD, the psychedelic side effects of which were discovered unintentionally).

In some jurisdictions, drugs that are highly similar in structure to a prohibited drug are illegal to trade regardless of that drug's legal status (or indeed whether or not the structurally similar analogue has similar pharmacological effects). In other jurisdictions, their trade is a legal grey area, making them grey market goods. Some jurisdictions may have analogue laws that ban drugs similar in chemical structure to other prohibited drugs, while some designer drugs may be prohibited irrespective of the legal status of structurally similar drugs; in both cases, their trade may take place on the black market.

Following the passage of the Second International Opium Convention in 1925, which specifically banned morphine and the diacetyl ester of morphine, heroin, a number of alternative esters of morphine quickly started to be manufactured and sold. The most notable of these were dibenzoylmorphine and acetylpropionylmorphine, which have virtually identical effects to heroin but were not covered by the Opium Convention. This then led the Health Committee of the League of Nations to pass several resolutions attempting to bring these new drugs under control, ultimately leading in 1930 to the first broad analogues provisions extending legal control to all esters of morphine, oxycodone and hydromorphone. Another early example of what could loosely be termed designer drug use, was during the Prohibition era in the 1930s, when diethyl ether was sold and used as an alternative to illegal alcoholic beverages in a number of countries.

During the 1960s and 1970s, a number of new synthetic hallucinogens were introduced, with a notable example being the sale of highly potent tablets of DOM in San Francisco in 1967. There was little scope to prosecute people over drug analogues at this time, with new compounds instead being added to the controlled drug schedules one by one as they became a problem. One significant court case from this period was in 1973, when Tim Scully and Nicholas Sand were prosecuted for making the acetyl amide of LSD, known as ALD-52.^{[citation needed]} At this time ALD-52 was not a controlled drug, but they were convicted on the grounds that in order to make ALD-52, they would have had to be in possession of LSD, which was illegal. The late 1960s also saw the introduction of various analogues of phencyclidine (PCP) to the illicit market, with Eticyclidine (PCE) first being detected in 1969.

The modern use of the term designer drug was coined in the 1980s to refer to various synthetic opioid drugs, based mostly on the fentanyl molecule (such as α-methylfentanyl). The term gained widespread popularity when MDMA (ecstasy) experienced a popularity boom in the mid-1980s. When the term was coined in the 1980s, a wide range of narcotics were being sold as heroin on the black market. Many were based on fentanyl or meperidine. One, MPPP, was found in some cases to contain an impurity called MPTP, which caused brain damage that could result in a syndrome identical to late stage Parkinson's disease, from only a single dose. Other problems were highly potent fentanyl analogues that caused many accidental overdoses.

Because the government was powerless to prosecute people for these drugs until after they had been marketed successfully, laws were passed to give the DEA power to emergency schedule chemicals for a year, with an optional 6-month extension, while gathering evidence to justify permanent scheduling, as well as the analogue laws mentioned previously. Emergency-scheduling power was used for the first time for MDMA. In this case, the DEA scheduled MDMA as a Schedule I drug and retained this classification after review, even though their own judge ruled that MDMA should be classified Schedule III on the basis of its demonstrated uses in medicine. The emergency scheduling power has subsequently been used for a variety of other drugs including 2C-B, AMT, and BZP. In 2004, a piperazine drug, TFMPP, became the first drug that had been emergency-scheduled to be denied permanent scheduling and revert to legal status.