The lounge suit is a bit of a misnomer. It actually refers to a business suit in most cases.
The name is more of a case of old translation and history, and the term is more often heard in the UK, especially on event invitations. It the past, business wear was much more formal, often being three pieces with hats and other accessories. This was especially so in the UK and was the case for hundreds of years. On the weekends and on holidays, it was worn as a more casual or leisurely form of dress. It was normally just a basic two-piece. They wouldn't normally be worn to work or for business. The morning suit with a frock jacket would be the more standard fair for a business or upper class work environment. You could swap in a full coat for a more formal evening wear requirement. These requirements have relaxed themselves over the years and especially in the 20th century.
Now, of course, what was once called lounge wear has become the traditional business wear. This is your standard two-piece with a shirt and tie. If you see an invitation to an event that calls for it, that doesn't mean your sweatpants and sweatshirt though! Its your normal work suit. Go with a darker, more conservative color though, such as a navy blue or black. It usually indicates in American parlance a semi-formal event. If the event is during the summer you may be OK going tieless, but it might be worth wearing one and taking it off if it is not needed.