Following the death of Aleister Crowley, magic as practiced by the still somewhat sparse occult subculture in Great Britain tended to become more experimentalist, personal and a lot less bound to the magical traditions of established magical orders. Main reasons for this might include the public availability of previously secret information on magic (especially in the books published by Aleister Crowley and Israel Regardie), the radically unorthodox magic of Austin Osman Spare's Zos Kia Cultus, the influence of Discordianism, the increasing popularity of magic caused by the success of the Wicca cult and the use of psychedelic drugs.
The term chaos magick first appeared in print in the widely influential "Liber Null" by Peter Carroll, first published in 1978. In it, Carroll formulated several concepts on magic that were radically different from what was considered magical mysteries in the days of Aleister Crowley. This book, along with "Psychonaut" by the same author, remains the main authority on chaos magic, as this magical current became known. Magicians who align themselves with these ideas call themselves chaotes.
Carroll also co-founded the Magical Pact of the Illuminates of Thanateros, short Illuminates of Thanateros or IOT, a magical (dis-)order that continues study and development of chaos magic to the present day. However, chaos magic unsurprisingly is among the least organized branches of magic.
Perhaps the most striking feat of chaos magic is the concept of the magical paradigm shift. Borrowing a term from philospher Thomas Kuhn, Carroll made the technique of arbitrarily changing one's model (or paradigm) of magic a major concept of chaos magic. It has since found its way into the magical work of practitioners of many other magical traditions.
Another major concept introduced by Carroll is the gnostic state, a special state of consciousness that in his magic theory is what is necessary for working (most forms of) magic. This is a departure from older concepts that described energies, spirits or symbolic acts as the source of magical powers.
Practitioners of chaos magic attempt to be outside of all categories - for them, worldviews, theories, beliefs, opinions, habits and even personalities are tools that may be chosen arbitrarily in order to understand or manipulate the world they see and create around themselves. Chaos magicians (a term sometimes called an oxymoron because it is a category for undefinable things) are often described as funny, extreme, individualist, erratic, anarchist or very hard to understand people.
While chaos magic has lost some of the popularity it had in the UK during the 1980s, it is still active and influential. Meanwhile, Carroll has departed from chaos magic to study concepts of magic reliant on mathematics, quantum physics and chaos theory.