If a nation has a piece of uranium a "develop nuclear reactor" option will become present in the economic tab.
When developing a nuclear reactor, there is a 60% chance of positive progress, a 20% chance of negative progress via stealth bomber and a 20% chance of no change (which gives you the failure message, "Unfortunately, our nuclear scientists have failed to make progress..."). Each step of progress costs one reputation level.
After a reactor is built, nukes can be made, costing 50 pieces of uranium, 100 million cash and 500 research per bomb. Nukes can be traded between nations with a 6 level reputation penalty for the sender (ghandi to questionable) and no penalty for the receiver.
Manufacturing a bomb will also drop you the same amount of levels, from ghandi-like to questionable (or 6 levels).
You can not manufacture bombs at Axis of Evil reputation or progress on a reactor at Axis of Evil reputation.
Effects of building a reactor
After 20 successful attempts at a cost of 1 uranium and 5000k each you will have the ability to manufacture nuclear bombs, the +1 growth does not exist because rumsod has not fixed it after ten years.
Develop Nuclear Reactor: Turn that yellow cake into magical electricity. Gives an extra $1 million growth (lol no it doesn't) a turn while operational and allows for the peaceful development of nuclear weapons. $5,000k You must have uranium to use this policy, it will not show if you do not possess uranium.
Build your reactor up enough and you can manufacture bombs, you do not receive one automatically upon completion. If you choose to fire the bomb, your reputation drops 7 levels; your target loses 100 growth, half of factories, half of navy, half of air force, and 75% of troops, and its manpower drops to Depleted.
Thanks to The Nuclear YOLOcaust we know what nukes do. On October 28 2015, Rattown nuked Idiocracy during the /pol/ocaust war. Outside the YOLOcaust, this was the first legit use of a nuke in the game.
Ahkazra nuked Zion in the reset chaos leading into 4.0, resulting in rumsod following reset tradition and giving everyone a nuclear bomb. It was subsequently followed by Gensokyo, FreakTopia, Rattown and WUBstep launching their held nuclear weapons on top of the ones received from rumsod.
best75 of Somalia became the first nation in realpolitik to manufacture and launch nuclear weapons, dropping one in late April on Turkey.
On Friday 19th August 2016, Neue Eisenfaust of Steel Brotherhood dropped a nuclear bomb on Yummy Foods of Interpol, destroying her nuclear reactor and single nuke, therefore establishing the SB-PALADIN coalition's nuclear monopoly over the other alliances of BLOC(It was later established that the reactor was not destroyed in the attack and the SB-PALADIN coalition leadership used the game's database that they had access to to delete the reactor and the nuke),
On Monday 22nd August 2016, Parsistan of PALADIN/Mojahedin dropped a nuclear bomb on Tamil Kingdom of PIRATES.
On Wednesday 31st August 2016, Deutsch Afrika of PALADIN dropped a nuclear bomb on Strongburn of Interpol.
On Wednesday 31st August 2016, Skekenhouse of Interpol dropped a nuclear bomb on Praetoria Augusta of PALADIN, destroying his nuclear reactor. Interpol had used a bug that meant people could continue to progress their reactor at Axis of Evil reputation, allowing them to manufacture and ship the bomb instantly.
On Wednesday 7th September 2016, Seraph of Interpol dropped a nuclear bomb on New Caucasus, destroying the second and last of the SB-PALADIN bloc reactors.
Less than two minutes later, Seraph of Interpol dropped a nuclear bomb on the same nation.