A relationship is strong connection or bond between two Sims. When both Sims interact, they both profit or lose points in their relationship. A relationship can be platonic, romantic or hostile and it's entirely based on their interaction history of the two Sims. Interacting with other Sims can use up your motives, particularly energy and hunger.
Different types of Relationship
These are Sims that you do not have any relation with. You don't have feelings towards them. All of the interactions are introductions. The color of the chat bubble is gray.
This is the first level of relationship that you will have with the other Sims if you talk or interact with them three times.
You can initiate a social event with that Sim to make your relationship stronger and to be a friend once your relationship level is at level 2. You can invite them in your house for a tea, share food or just gossip.
You can change the status of your friendly relationship with someone to a romantic one during relationship level 3 by initiating a Social Event called "Declare attraction". You'll be a romantic interest after the event.
You can be a close friend to other Sims if that said Sims is a friend of yours and with a relationship level 4. You can start a Social Event called "Deepen friendship" to become close friends.
You'll be sweetheart status once you've reached relationship level 5 with your romantic interest. You can now kiss, make out or hold hands.
You can be lovers once you've reached relationship level 7 with your sweetheart. You can now woohoo with your lover, but you must have the at least the Sleepytime Double.
These are Sims connected by blood. One good example is your baby. You can have baby once you've hit relationship level 8 and lover status. Another requirement is the bassinet.
While on relationship level 2, you can declare rivalry with other Sims. That Sims will be your arch nemesis. You can do mean interactions such as slapping or insulting.
What is interaction?
Relationships are formed or destroyed by interactions. These are actions by your Sims towards the other. It can be a friendly gesture or hostile one, but you can acquire a relationship point for each interaction.