Using Google searches, I have found little information on clearing of insects to observe their structure. What information that is available does not relate the benefits and detriments of various clearing agents. Here I will summarize these issues, especially to show the benefit of using lactic acid contrasted with hydroxides.
Potassium hydroxide (KOH: also known as caustic potash or lye) is a strongly basic chemical that has historically been most often used for insect clearing. It is stored as a solid and dissolved in distilled water for use, usually as a 10% solution. When heated, soft tissue is quickly destroyed as well as lightly sclerotized cuticle. Continued exposure to KOH will cause the chitonous matrix of cuticle to become sticky and soft, and a specimen left in KOH for extended periods will become clear and dissolve into invisibility. The destructive process can be slowed down by clearing in room temperature solution rather than heated, but a specimen exposed to KOH cannot ever be neutralized completely. Many old slides of specimens, including holotypes, today seem to contain nothing due to the long term caustic action of this chemical. In addition, once a specimen is placed in glycerin for viewing, it cannot be returned to KOH for more clearing.
Sodium hydroxide (NaOH) has similarly been used in clearing. It has the same properties of KOH, except it is reported that it is less caustic on weakly sclerotized tissue and membrane (Gurney et al. 1964).
Lactic acid (2-hydroxypropanoic acid) is a weakly acidic chemical now coming into favor as a clearing agent. It is stored as a fluid, usually at 80% concentration, and can be used directly. Unlike the previous hydroxides, lactic acid will not indefinitely clear material, even when heated. Membraneous and weakly sclerotized structures are retained while muscle and fat are dissolved. Lactic acid also will cause membraneous structures to expand under heat, which can make the treatment useful for eversing an aedeagus stuck within a phallocrypt. In addition, the specimen can be passed through glycerin and returned to the clearing solution if needed.
I have begun using lactic acid for all my clearing. The benefits are obvious, with some precautions. First, since heating causes expansion of tissue, sometimes specimens will explode. Therefore, only low circulating heat rather than boiling should be used. Second, while weakly sclerotized structures will be retained, intersegmental membrane is more likely to be broken over time. Gentle care when using probes and forceps will insure the parts stay connected.
Gurney, A. B.; Kramer, J. P.; Steyskal, G. C. 1964. Some techniques for the
preparation, study, and storage in microvials of insect genitalia. Annals of the
Entomological Society of America 57:240-242.