The best pepper for making hot sauce depends on the desired heat of the sauce; green bell peppers are good for a mild sauce, whereas ghost peppers are good for an extremely hot sauce. Jalapeño, serrano and habanero peppers are also good peppers for hot sauce.
The hotness of a pepper is measured in Scoville units, named after the chemist Wilbur Scoville. Check the Scoville units of each pepper before including it in the hot sauce to ensure the sauce ends up at the desired level of heat. If the sauce is too mild or too hot, adjust the pepper content of the sauce when making the next batch.