Alchemist began as a three piece band formed c.1988 featuring Ross Holloway (guitar, vocals), Patrick Bellamy (bass) and Sarah Oliver (drums). Holloway had previously been in Room 11 and the recently disbanded Two White Eyes, having just returned to Hamilton from Two White Eyes' excursion to Christchurch. Bellamy had played in Cygnet Committee (briefly) and Primer One.
In 1989 Sarah Oliver was replaced on drums by Hugh McGill, and Stan Jagger joined on second guitar. Jagger had previously played with Mudpeople and Frybrain. This lineup became known as The Alchemist and released a song, Schizophrenic Blues, on the 1989 compilation Surf Music.
Ross Holloway when interviewed (October 2006) said that The Alchemist had "never really fired properly, but did get some good recordings down". During the mid '80s he had become known as an outspoken figure within Hamilton music circles; actively seeking to bring about change within what he saw as a "bland" and "conformist" attitude dominating the local scene. By the tail end of the '80s a stronger "alternative" music and subculture scene had been established, but Holloway now expressed the view that many within "alternative" circles had simply traded in one form of conformity for another. He was not shy about labeling the scene as "pretentious", which eventually led him into conflict with a number of his peers, including some members of The Alchemist.
In 1990 the band dissolved amid the aforementioned personality clashes. The breakup was very public, happening in front of an audience at Rockerfellas in Frankton. Holloway's response to these circumstances was a project known as Sour Grapes. The following year, he and Stan Jagger went on to form a new band known as Pregnant Hippies as the new live vehicle for material written and recorded for The Alchemist. Although the only official release under the name of Alchemist is the 1989 appearance on Surf Music, recorded material by the band does in fact appear on A Decade on the Hamilton Underground (1991), but was released under the name of Pregnant Hippies.