Recommendations for poker chip sets depend on several variables, such as a) are you playing a cash game or a tournament, and b) if a cash game, what stakes are you playing for?
Even if you're not playing for real money, you still need to know whether you're playing a tournament (everyone gets a certain total value of chips to begin with, and play continues with blinds rising over time until one by one players run out of chips and drop out of the tournament) or a cash game (players receive as many chips as they're willing to pay for, each player plays for as long as they like, and when a player decides to stop they cash out and get paid for however many chips they have left or have won from other players). If you're not playing for real money you can still play a "cash" game, where everyone gets as many chips as they want for free, and the goal is simply to try to win as much as possible from the other players over the course of the night (i.e. people who show a net profit are winners and people who show a net loss are losers). But cash vs. tournament is the first consideration; if you decide which of those you want to do, we can help you choose a good set of chips.
The next considerations is stakes
if you are playing a cash game. In a tournament, the stakes are the buy-in, which in your case would simply be zero. In a cash game, the stakes determine the blinds.
If you're not playing for real money, I recommend you set your simulated cash game stakes at $1/$2, i.e. the small blind is $1 and the big blind is $2. That'll be convenient for you and your players and will make it easy to assemble a set of chips that will suit your needs.
A one-table cash game set that's typically recommended here is 600 chips in five denominations, which for a $1/$2 game would be:
100x $1
200x $5
200x $25
80x $100
20x $500
A one-table tournament set that's typically recommended here is 400 chips in five denominations:
120x T25
120x T100
50x T500
80x T1000
30x T5000
The "T" in the denomination indicates that the tournament chip has no cash value. The chip is typically labeled with just a number without a dollar sign.
There are plenty of other perfectly viable breakdowns, but they're roughly similar to these. You can make the sets smaller or larger, you can change the distribution somewhat, you can use even racks (all quantities divisible by 100) or not, all according to your preferences. You probably don't want to use more than five denominations in a set; as few as three is workable, as many as six is not unreasonable but is unnecessary. You can search the forum for a great many examples of recommended breakdowns for both cash and tournament sets.
The examples above assume that you're playing no-limit hold'em. If you're playing fixed-limit games, you'd want more of the smallest denomination, potentially even making the set almost entirely a single denomination. If you're playing games other than hold'em - in particular, if you're playing any stud games - then you might want some chips that are even smaller to serve as antes, or you might alter the stakes for those games.
As
@Silver_Fiend points out, the specifics of what your set should contain depends on the specifics of the games you intend to run. People playing for real money usually have these kinds of details already established, and so that determines the sets they'll need. Since you're playing for imaginary money, you have the flexibility to run any kind of game you want; conversely, it means that you can choose to run a game that's appropriate for the set you assemble, effectively working the problem backwards.