<PAGE>
 
                                                   Registration No. 333-

--------------------------------------------------------------------------------

                       SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549

                          ---------------------------
                                    FORM S-8
                             Registration Statement
                                     Under
                           The Securities Act of 1933
                          ---------------------------

                             ARCO Chemical Company
             (Exact name of Registrant as specified in its charter)

                 Delaware                                      51-0104393
-----------------------------------------------------    ----------------------
(State or other jurisdiction of incorporation               (I.R.S. Employer 
              or organization)                             Identification No.)

3801 West Chester Pike, Newtown Square, Pennsylvania           19073-2387
-----------------------------------------------------    -----------------------
     (Address of Principal Executive Offices)                  (Zip Code)
                                        

                             ARCO CHEMICAL COMPANY
                         1990 LONG-TERM INCENTIVE PLAN
                            (Full title of the plan)
              --------------------------------------------------

Robert J. Millstone, Esq.               Copy to:  Kathy Habecker Gaddes, Esq.
Vice President, General Counsel and               ARCO Chemical Company
 Secretary                                        3801 West Chester Pike
ARCO Chemical Company                             Newtown Square, PA  19073-2387
3801 West Chester Pike                            (610) 359-3208
Newtown Square, PA 19073-2387
(610) 359-3255
(Name, address and telephone number of agent for service)
<TABLE> 
<CAPTION> 

                        CALCULATION OF REGISTRATION FEE
====================================================================================================

     Title of            Amount to be       Proposed Maximum    Proposed Maximum       Amount of
  Securities to be       Registered*       Offering Price Per  Aggregate Offering    Registration
    Registered                                   Share**            Price**              Fee
<S>                      <C>               <C>                 <C>                   <C>   
   Common Stock, par     200,000 shares        $ 48.3125           $9,662,500         $2,928.03
 value $1.00 per share                

----------------------------------------------------------------------------------------------------
</TABLE>
*  This Registration Statement also relates to such indeterminate number of
   additional shares as may be offered as a result of stock splits, stock
   dividends or similar transactions.

** The proposed maximum offering price per share and the proposed maximum
   aggregate offering price are calculated solely for the purpose of determining
   the registration fee pursuant to Rule 457(c) and (h) under the Securities Act
   of 1933, as amended. Such prices are based on a price of $48.3125, which is
   the average of the high and low sale prices per share of the Registrant's
   Common Stock on December 26, 1996, as reported on the New York Stock Exchange
   Composite Tape.
<PAGE>
 
                                    PART II
                                        
               INFORMATION REQUIRED IN THE REGISTRATION STATEMENT
               --------------------------------------------------
                                        
 
          Pursuant to General Instruction E to Form S-8 under the Securities Act
of 1933, as amended, this Registration Statement is filed to register 200,000
additional shares of common stock, par value $1.00 per share ("Common Stock"),
of ARCO Chemical Company (the "Company"), authorized for issuance under the
terms of the ARCO Chemical Company 1990 Long-Term Incentive Plan.  The content
of the Registration Statement on Form S-8, Registration No. 33-38062, filed with
the Securities and Exchange Commission on December 3, 1990, is hereby
incorporated by reference.


Item 5.   Interests of Named Experts and Counsel
          --------------------------------------

          The legality of the Common Stock offered pursuant to this Registration
Statement will be passed upon for the Company by Robert J. Millstone, Esq., Vice
President, General Counsel and Secretary of the Company. As of December 30,
1996, Mr. Millstone owned an aggregate of 1,165.719 shares of Common Stock, held
under a Company benefit plan, and options to purchase another 35,100 shares of
Common Stock. Mr. Millstone disclaims beneficial ownership of an additional
308.289 shares of Common Stock held in a custodial account for his minor son and
a trust for his adult son.

                                     II-1
<PAGE>
 
<TABLE> 
<CAPTION> 

Item 8.   Exhibits
          --------

 Number                   Description                       Method of Filing
--------     ------------------------------------------    ------------------
<S>          <C>                                           <C> 

   5         Opinion of Robert J. Millstone, Esq., Vice    Filed herewith
             President, General Counsel and Secretary 
             of the Company as to the legality of the 
             securities being registered

  23.1       Consent of Robert J. Millstone, Esq.,Vice     Included in Exhibit 5
             President, General Counsel and Secretary 
             of the Company

  23.2       Consent of Coopers & Lybrand L.L.P.           Filed herewith
                             
  24         Power of Attorney authorizing John A. Shaw    Filed herewith 
             to sign the Registration Statement and all
             amendments thereto on behalf of certain
             directors and officers of the Company
</TABLE>

                                     II-2
<PAGE>
 
                                   SIGNATURES
                                   ----------

          The Registrant. Pursuant to the requirements of the Securities Act of
          --------------
1933, as amended, the Registrant certifies that it has reasonable grounds to
believe that it meets all of the requirements for filing on Form S-8 and has
duly caused this Registration Statement to be signed on its behalf by the
undersigned, thereunto duly authorized, in Newtown Square, Commonwealth of
Pennsylvania, on this 31st day of December, 1996.

                                       ARCO Chemical Company



                                       By:             ALAN R. HIRSIG
                                          -------------------------------------
                                                      Alan R. Hirsig
                                          President and Chief Executive Officer


          Pursuant to the requirements of the Securities Act of 1933, as
amended, this Registration Statement has been signed below by the following
persons, in the capacities and on the date indicated.

<TABLE>
<CAPTION>

         Signature                         Capacity                         Date
         ---------                         --------                         ----
<S>                            <C>                                     <C>  
                                                                            
                                                                            
      MIKE R. BOWLIN*                 Chairman of the Board            December 31, 1996
---------------------------               and Director 
      Mike R. Bowlin                                                 
                                                                               
                                                              
                                                                               
      ALAN R. HIRSIG                       President,                  December 31, 1996
---------------------------    Chief Executive Officer and Director
      Alan R. Hirsig       
                                                              
                                                                                
                                                                                
     MARVIN O. SCHLANGER*            Executive Vice President,         December 31, 1996
---------------------------    Chief Operating Officer and Director 
     Marvin O. Schlanger       
                                                                                
                                                                                
 
      WALTER J. TUSINSKI*               Senior Vice President,         December 31, 1996
---------------------------     Chief Financial Officer and Director    
      Walter J. Tusinski                                       
</TABLE> 

                                     II-3
<PAGE>
 
<TABLE>
<CAPTION>

         Signature                         Capacity                         Date
         ---------                         --------                         ----
<S>                                   <C>                             <C>  

                              
       RONALD J. ARNAULT*                    Director                  December 31, 1996
-------------------------------
       Ronald J. Arnault                                    
                                                               
                                                               
                                                               
       WALTER F. BERAN*                      Director                  December 31, 1996                                 
-------------------------------
       Walter F. Beran                                                
                                                               
                                                               
                                                               
      ANTHONY G. FERNANDES*                  Director                  December 31, 1996                       
-------------------------------            
      Anthony G. Fernandes                                           
                                                               
                                                              
                                                      
       MARIE L. KNOWLES*                     Director                  December 31, 1996
-------------------------------            
       Marie L. Knowles                                               
                                                              
                                                     
                                                              
      JAMES A. MIDDLETON*                    Director                  December 31, 1996
-------------------------------                       
      James A. Middleton                                            
                                                    
                                                               
                                                              
         FRANK SAVAGE*                       Director                  December 31, 1996
-------------------------------            
         Frank Savage                                         
                                                               
                                                              
                                                              
      ROBERT H. STEWART, III*                Director                  December 31, 1996
-------------------------------- 
      Robert H. Stewart, III          
 
 
 
         JOHN A. SHAW               Vice President and Controller      December 31, 1996
--------------------------------    (principal accounting officer) 
         John A. Shaw
 
 
* By:    JOHN A. SHAW                                                  December 31, 1996
     ---------------------------
         John A. Shaw
      (Attorney in fact)
</TABLE> 

                                     II-4
<PAGE>
 
                                 EXHIBIT INDEX
                                 -------------
<TABLE> 
<CAPTION> 
 
Number                      Description                      Method of Filing
------      -------------------------------------------   ---------------------
<S>         <C>                                           <C> 

  5         Opinion of Robert J. Millstone, Esq., Vice    Filed herewith
            President, General Counsel and Secretary of
            the Company as to the legality of the
            securities being registered

 23.1       Consent of Robert J. Millstone, Esq., Vice    Included in Exhibit 5
            President, General Counsel and Secretary of
            the Company

 23.2       Consent of Coopers & Lybrand L.L.P.           Filed herewith
            
 24         Power of Attorney authorizing John A. Shaw    Filed herewith
            to sign the Registration Statement and all
            amendments thereto on behalf of certain
            directors and officers of the Company
</TABLE>
[{"type": "S-8", "sequence": "1", "description": "FORM S-8 REGISTRATION STATEMENT", "secsgml_size_bytes": 13410}]
{"company-data": {"conformed-name": "ARCO CHEMICAL CO", "cik": "0000819544", "assigned-sic": "2860", "irs-number": "510104393", "state-of-incorporation": "DE", "fiscal-year-end": "1231"}, "filing-values": {"form-type": "S-8", "act": "33", "file-number": "333-19023", "film-number": "96688621"}, "business-address": {"street1": "3801 WEST CHESTER PIKE", "city": "NEWTOWN SQUARE", "state": "PA", "zip": "19073", "phone": "2153592000"}}
Registration No. 333-

--------------------------------------------------------------------------------

                       SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549

                          ---------------------------
                                    FORM S-8
                             Registration Statement
                                     Under
                           The Securities Act of 1933
                          ---------------------------

                             ARCO Chemical Company
             (Exact name of Registrant as specified in its charter)

                 Delaware                                      51-0104393
-----------------------------------------------------    ----------------------
(State or other jurisdiction of incorporation               (I.R.S. Employer 
              or organization)                             Identification No.)

3801 West Chester Pike, Newtown Square, Pennsylvania           19073-2387
-----------------------------------------------------    -----------------------
     (Address of Principal Executive Offices)                  (Zip Code)
                                        

                             ARCO CHEMICAL COMPANY
                         1990 LONG-TERM INCENTIVE PLAN
                            (Full title of the plan)
              --------------------------------------------------

Robert J. Millstone, Esq.               Copy to:  Kathy Habecker Gaddes, Esq.
Vice President, General Counsel and               ARCO Chemical Company
 Secretary                                        3801 West Chester Pike
ARCO Chemical Company                             Newtown Square, PA  19073-2387
3801 West Chester Pike                            (610) 359-3208
Newtown Square, PA 19073-2387
(610) 359-3255
(Name, address and telephone number of agent for service)
CALCULATION OF REGISTRATION FEE
====================================================================================================

     Title of            Amount to be       Proposed Maximum    Proposed Maximum       Amount of
  Securities to be       Registered*       Offering Price Per  Aggregate Offering    Registration
    Registered                                   Share**            Price**              Fee
Common Stock, par     200,000 shares        $ 48.3125           $9,662,500         $2,928.03
 value $1.00 per share                

----------------------------------------------------------------------------------------------------
*  This Registration Statement also relates to such indeterminate number of
   additional shares as may be offered as a result of stock splits, stock
   dividends or similar transactions.

** The proposed maximum offering price per share and the proposed maximum
   aggregate offering price are calculated solely for the purpose of determining
   the registration fee pursuant to Rule 457(c) and (h) under the Securities Act
   of 1933, as amended. Such prices are based on a price of $48.3125, which is
   the average of the high and low sale prices per share of the Registrant's
   Common Stock on December 26, 1996, as reported on the New York Stock Exchange
   Composite Tape.
PART II
                                        
               INFORMATION REQUIRED IN THE REGISTRATION STATEMENT
               --------------------------------------------------
                                        
 
          Pursuant to General Instruction E to Form S-8 under the Securities Act
of 1933, as amended, this Registration Statement is filed to register 200,000
additional shares of common stock, par value $1.00 per share ("Common Stock"),
of ARCO Chemical Company (the "Company"), authorized for issuance under the
terms of the ARCO Chemical Company 1990 Long-Term Incentive Plan.  The content
of the Registration Statement on Form S-8, Registration No. 33-38062, filed with
the Securities and Exchange Commission on December 3, 1990, is hereby
incorporated by reference.

Item 5.   Interests of Named Experts and Counsel
          --------------------------------------

          The legality of the Common Stock offered pursuant to this Registration
Statement will be passed upon for the Company by Robert J. Millstone, Esq., Vice
President, General Counsel and Secretary of the Company. As of December 30,
1996, Mr. Millstone owned an aggregate of 1,165.719 shares of Common Stock, held
under a Company benefit plan, and options to purchase another 35,100 shares of
Common Stock. Mr. Millstone disclaims beneficial ownership of an additional
308.289 shares of Common Stock held in a custodial account for his minor son and
a trust for his adult son.

                                     II-1
Item 8.   Exhibits
          --------

 Number                   Description                       Method of Filing
--------     ------------------------------------------    ------------------
5         Opinion of Robert J. Millstone, Esq., Vice    Filed herewith
             President, General Counsel and Secretary 
             of the Company as to the legality of the 
             securities being registered

  23.1       Consent of Robert J. Millstone, Esq.,Vice     Included in Exhibit 5
             President, General Counsel and Secretary 
             of the Company

  23.2       Consent of Coopers & Lybrand L.L.P.           Filed herewith
                             
  24         Power of Attorney authorizing John A. Shaw    Filed herewith 
             to sign the Registration Statement and all
             amendments thereto on behalf of certain
             directors and officers of the Company
II-2
SIGNATURES
                                   ----------

          The Registrant. Pursuant to the requirements of the Securities Act of
          --------------
1933, as amended, the Registrant certifies that it has reasonable grounds to
believe that it meets all of the requirements for filing on Form S-8 and has
duly caused this Registration Statement to be signed on its behalf by the
undersigned, thereunto duly authorized, in Newtown Square, Commonwealth of
Pennsylvania, on this 31st day of December, 1996.

                                       ARCO Chemical Company

                                       By:             ALAN R. HIRSIG
                                          -------------------------------------
                                                      Alan R. Hirsig
                                          President and Chief Executive Officer

          Pursuant to the requirements of the Securities Act of 1933, as
amended, this Registration Statement has been signed below by the following
persons, in the capacities and on the date indicated.
Signature                         Capacity                         Date
         ---------                         --------                         ----
MIKE R. BOWLIN*                 Chairman of the Board            December 31, 1996
---------------------------               and Director 
      Mike R. Bowlin                                                 
                                                                               
                                                              
                                                                               
      ALAN R. HIRSIG                       President,                  December 31, 1996
---------------------------    Chief Executive Officer and Director
      Alan R. Hirsig       
                                                              
                                                                                
                                                                                
     MARVIN O. SCHLANGER*            Executive Vice President,         December 31, 1996
---------------------------    Chief Operating Officer and Director 
     Marvin O. Schlanger       
                                                                                
                                                                                
 
      WALTER J. TUSINSKI*               Senior Vice President,         December 31, 1996
---------------------------     Chief Financial Officer and Director    
      Walter J. Tusinski
II-3
Signature                         Capacity                         Date
         ---------                         --------                         ----
RONALD J. ARNAULT*                    Director                  December 31, 1996
-------------------------------
       Ronald J. Arnault                                    
                                                               
                                                               
                                                               
       WALTER F. BERAN*                      Director                  December 31, 1996                                 
-------------------------------
       Walter F. Beran                                                
                                                               
                                                               
                                                               
      ANTHONY G. FERNANDES*                  Director                  December 31, 1996                       
-------------------------------            
      Anthony G. Fernandes                                           
                                                               
                                                              
                                                      
       MARIE L. KNOWLES*                     Director                  December 31, 1996
-------------------------------            
       Marie L. Knowles                                               
                                                              
                                                     
                                                              
      JAMES A. MIDDLETON*                    Director                  December 31, 1996
-------------------------------                       
      James A. Middleton                                            
                                                    
                                                               
                                                              
         FRANK SAVAGE*                       Director                  December 31, 1996
-------------------------------            
         Frank Savage                                         
                                                               
                                                              
                                                              
      ROBERT H. STEWART, III*                Director                  December 31, 1996
-------------------------------- 
      Robert H. Stewart, III          
 
 
 
         JOHN A. SHAW               Vice President and Controller      December 31, 1996
--------------------------------    (principal accounting officer) 
         John A. Shaw
 
 
* By:    JOHN A. SHAW                                                  December 31, 1996
     ---------------------------
         John A. Shaw
      (Attorney in fact)
II-4
EXHIBIT INDEX
                                 -------------
Number                      Description                      Method of Filing
------      -------------------------------------------   ---------------------
5         Opinion of Robert J. Millstone, Esq., Vice    Filed herewith
            President, General Counsel and Secretary of
            the Company as to the legality of the
            securities being registered

 23.1       Consent of Robert J. Millstone, Esq., Vice    Included in Exhibit 5
            President, General Counsel and Secretary of
            the Company

 23.2       Consent of Coopers & Lybrand L.L.P.           Filed herewith
            
 24         Power of Attorney authorizing John A. Shaw    Filed herewith
            to sign the Registration Statement and all
            amendments thereto on behalf of certain
            directors and officers of the Company