Key Items are unique, non-consumable items that are essential for progressing the main story or unlocking specific side quests. They cannot be sold or discarded. You acquire key items by completing objectives, speaking to specific NPCs, or finding them in critical locations. The game automatically places them in a separate 'Key Items' section of your inventory.
Examples of key items include: the 'World Map' (which allows you to view the entire world), 'Ship's Wheel' (to control your ship), 'Magic Mirror' (used in a specific quest), and various 'Orbs' or 'Crests' that are required to unlock new areas or advance the plot. If you ever find yourself stuck in the main story, check your key items to see if you've recently acquired something that might provide a clue or open a new path. The game is generally good at guiding you towards the next key item, but sometimes a bit of exploration or talking to all NPCs is required. Always pay attention to descriptions of newly acquired key items, as they often contain hints about their purpose.