So you are looking to add some kind of chat room to your website? There are many solutions to the problem and everyone will tell you that their suggestion is best. The truth is you have to decide for your site in your position.

Why have a chat room?
It may be that your site won't benefit from a chat room. There are many chat rooms out there that have much tumbleweed blowing across them - the only thing that chat room does it show visitors that nobody uses the site.

The point of having a chat room is to get people coming back to the site and discussing the site with other visitors. Therefore you need two things - plenty of visitors so that there is several people in there to chat and also a purpose. If your site is about nothing in particular people probably won't use it. After all they could use IRC, MSN, Yahoo or one of the numerous other chat services out there.

HTML Solutions
There are probably fairly simple. All you need is a database and a server side scripting language. Your visitors don't need anything such as Java or a plugin, they can chat just using a browser that supports frames and meta refresh. This is a similar system to the one operated by www.cgispider.com.

Good points: Can be easily written yourself, visitor can access it easily, easily hosted on a server with a database and server side scripting

Bad points: Not real chat, the text only updates every few seconds or so, not when a message is sent. Refreshing can annoy visitors and sometime visitors may leave but still appear to be in the chat. Chat lines go in at the top and go down rather than being entered at the bottom.

Java / IRC solution
IRC has become one of the biggest chat platforms out there. There are now many networks across the globe and most will allow you to create your own channels on their server. There are also plenty of Java applets out there that will allow you to connect your visitors to it.

Good points: Widely available Java applets and plenty of networks to create your chat room on, well known platform, may get some hardcore chatters who spend all day in your chat room

Bad points: Visitors require Java, people may connect using software such as Mirc (www.mirc.com) or Trillian (www.trillian.cc) and bypass your actual side, not emoticons and graphics risk of IRC abuse.

Custom solutions
If you don't want to use a conventional method you can always get a custom solution created. There are many developers and companies out there who can write custom chat scripts via Java, plugins or other methods which will seamlessly fit into your site and be customised to your needs.

Good points: Customised to site, can be hosted onsite, professional

Bad points: Expensive, visitors may require Java or a plugin, may need to get the developers to make any changes you require

Shout boxes
Getting more distant from a true chat room, a shout box can be considered more like a message board. Users can post a message and the latest 10 are traditionally shown in a box on your page.

Good points: Very basic to put into place, easy to do

Bad points: Not really a chat room as such

Conclusion
The solution you pick is likely to be based on your budget. If you have plenty of money to invest a custom solution would be great; however most sites will require something far more modest.