Note: To work with Keywords in iPhoto '08, click here.
To create keywords, go to iPhoto's preferences and go to the Keywords section.
iPhoto comes with a list of default keywords that you can use or delete. You can add as many keywords as you like. Use the + button under the keyword list to add a new keyword; use the - button to delete the selected keyword.
The key to creating keywords is to think about how you might want to filter your photos later. In the illustration at the right, you will see keywords for people's names and keywords for situations. You can always come back and modify you keywords list later.