By far, the most common smoke formula is the Potassium Nitrate/Sugar formula. It produces a white-gray smoke and is easy, inexpensive, and fun to make. The percentage of potassium nitrate and sugar in this composition vary somewhat depending on who you ask, but the 60/40 mix listed below is pretty common.
A lump of this stuff the size of your thumb produced the smoke cloud in the image below in under 2 seconds.
Although the two ingredients can just be finely powdered and mixed together, in recent side-by-side tests, we found that melting the two together does, in fact, make a superior Smoke Bomb. To melt the mixture together, you'll need small metal saucepan (or other heat resistant container) and an electric hot plate. An electric hot plate is preferred to an open flame heat source because it's a tad safer, and easier to prevent overheating of the mixture. The mixture must be heated SLOWLY, and over a LOW heat until it just starts to melt. Heating it too quickly, or at too high a temperature will cause it to turn black, burn and ignite, creating a giant mess AND a fire hazard. In any case, this should all be done outside, just in case you overheat it and it does happen to ignite. As the mixture begins to melt, it will turn brown and look very similar to caramel candy or peanut butter (see image above). After all, you are melting sugar (and no, you can't eat it).
Start by making a small batch (50 grams total). Measure out 30 grams of potassium nitrate and 20 grams of sugar into a small cup. For those of you who cut math class, 30 grams of potassium nitrate and 20 grams of sugar is still a 60/40 mixture. If you make a batch larger than 50 grams, it will be very difficult to mix and heat evenly. You can always make more, so don't mix up a giant batch.
Snap a lid on the container and shake to mix the two chemicals together. Pour the mixture into a heat resistant container and set it on your hot plate.
Set the hot plate temperature to medium-high, and about every 30 seconds or so, stir the mixture well, being sure to scrape the material that may start sticking to the bottom.
Over the next several minutes, the mixture will begin to darken and clump. It will soon begin to look like brown sugar, and when it finally mixes smoothly and looks like peanut butter, it is done. If your mixture is turning BLACK, you're heating it at too high of a temperature.
Remove the container from the heat and scoop out a lump of the sticky mass. You can either just plop some on the concrete, or if you're picky about the way your smoke bombs look, you can make small cardboard molds and press the gooey mass into them. Personally, we just lay it on the concrete.
Before the little blob cools, insert a small piece of Visco Safety Fuse.
Do this with the remainder of the material, and allow them to cool and harden.
In about 5 minutes, the material will be cool and become rock hard (beware that it will stick to the surface while cooling, but is easily removed with a little knock from a hammer). Set your Smoke Bomb away from any flammable materials, light the fuse, and stand back!
The smoke from this mixture is essentially non-toxic, but that doesn't mean you should stand in a cloud of it and breathe it all day long. Like any smoke from burning material, people may be allergic to it, or it may cause eye irritation in some more sensitive folks.
Unfortunately, colored smoke mixes are a totally different animal. The nitrate/sugar mix cannot be colored. Colored mixes use an entirely different cool-burning mixture and vaporize special low-temperature dyes to produce colored smoke.