'The bee's knees' is an expression which denotes that something is desirable or the best of its kind. It originated in America in the 1920s along with a number of other two-word expressions which were constructed in similar animal/anatomy format, although there were exceptions to this format.

Some further examples :

Assorted animals :

Felines :

While 'the bee's knees' is certainly slang and does indeed rhyme, it is not actually rhyming slang in the normal sense, since true rhyming slang consists of a phrase which rhymes with the word that it is substituted for, such as 'butcher's hook' for 'look'.