The Potion is an item that usually restores some health. In most modern games, it restores a small but significant amount of health. It usually gives less health than a High Potion. EX Potions are full strength potions that recover all HP.
Potions first appeared in Vampire Killer, where they were used to fully replenish Simon's health. Most subsequent classic games used Meat to replenish health instead. Potions returned in Symphony of the Night, where they differed from Food items in that their effect was immediate (food items were tossed out and needed to be collected again in order to consume them, making it possible to be killed in the meantime). Later games where USE ITEMS such as food and potions were selected from a menu instead of being equipped, had no fundamental difference between the two types. Potions are usually available in shops.
In Order of Shadows, the use of the item has been switched to that of the Tonic: instead of restoring HP, it restores MP.