Well, the answer to this depends on what mods you are working with. If you are not playing with mods, then your NPC sims just exist. If you have aging on, they will grow older and eventually pass away. They don't autonomously do anything in my experience. Now if you use a mod like MCCC, then they can proceed in life however you envision it. I have NPCs that are in College, that move in with other sims, get married, have children, have affairs advance in their careers, etc. Up until a few months ago, I never played with mods or CC. I focused on one family per save and sort of moved them along. The townies and NPCs were just background noise. Now that I play with MCCC, NPCC, and a few others, I have found that my wonderful NPC's actually live lives similar to my played sims! I can't even tell you how awesome that is. They develop their own stories and I am ok with that!
