From #openttdcoop wiki
The Chaos_Theory Concept
The 'Chaos Theory' Concept is a simple one to understand. It is essentially that of an incrementally developed transportation network, growing to fit the needs of what goods and services you need to transport at any given time. Chaos theory is best described by one word: "organic." Not much is known when we start building... only the train length and cargoes. Track goes wherever it is needed to go to serve stations, which are expanded when needed.
Building in Chaos still needs to be clean, e.g. no 90 degree turns when avoidable. Chaos is working without a plan, besides the points mentioned above. Whatever you build is up to your good judgement. There is no designated Mainline, as it will grow along the way.
Although the Chaos Theory might have the tendency of being messier, it is not the main target to have a mess in a game. During the game routes will change and the network will be cleaned up and optimized, so in the end there is a "clean" network that started without a predefined plan.
The best way to get an idea of how Chaos Theory works is to download a save and have a look yourself.
Because the "messier" part of games tends to be "mega messy" on Public Server, chaos was officially banned from PS. ProZone games still run chaos from time to time because the networks tend to be less messy there from the very beginning and over all making more perspective decisions.