Alchemy...

It's a rather complex and higher level function that allows you to bolster the
effectiveness of your items. You can artificially infuse weapons with bonuses
this way. For example, you may have seen weapons with a +1 or +2 modifier.
With alchemy, you can increase this number all the way to +9. There is a chance
of failure, however, and it is recommended against using alchemy at all unless
you do everything in your power to prevent an unsuccessful enchant.
http://www.gamefaqs.com/computer/doswin/file/930711/43300