Phthalimide potassium salt is primarily used as a key intermediate in the synthesis of various organic compounds, particularly in the production of pharmaceuticals and agrochemicals. It serves as a precursor for the Gabriel synthesis, a method widely employed to produce primary amines, which are essential building blocks in drug development. Additionally, it finds application in the manufacture of dyes, pigments, and other specialty chemicals. Its role in organic synthesis is significant due to its ability to introduce nitrogen-containing functional groups into target molecules, making it valuable in research and industrial processes.