Many analytics programs allow you to see referring search engine "keywords" and "keyphrases" as two separate reports, and it's important to understand what the difference between these for SEO or PPC. ("Keyphrase" is probably more correctly written as "key-phrase", but my spelling has never been perfect, so why start now!)
A "keyphrase" report will show you the exact referring search phrases, usually sorted by volume/hits. A "keyword" report will show you the hit count for each unique keyword across all of the referring keyphrases.
Keyphrases are pretty simple. The analytics program will track each exact referring phrase from each search engine, and each time it sees a new hit for a keyphrase, it will increment the count. For example, if 10 different people find your site by searching for "download music", then that keyphrase will have 10 hits. If another 10 people find your site for "music download" (the same words reversed), then this phase will also have 10 hits, and the keyphrase report will be:
A keyword report will separate each individual keyword from it's keyphrase and find the hit count for that keyword across all search keyphrases. So, given the same 20 referring search keyphrase hits from the example above (10 for "download music" and 10 for "music download"), a keyword report would show the following:
This is because the words "download" and "music" appear a total of 20 times each.
First and foremost, the keyword report does not give you a clear idea of exactly how people are finding your site. Instead, it gives you a very broad overview of the main keywords that are being used to find your site, but not the exact keywords. These keywords may have a "long tail". In our example above, none of the traffic came directly from searches for "download" or "music", yet both of these show 20 hits. Looking at the keyphrase report will tell you the exact keyphrases that drove traffic.
The total hit count for a keyword report will also be inaccurate. In our example, the total traffic was 20 (10+10), yet our keyword report gives the impression that we received 40 (20+20) hits.
All-in-all, both keyword and keyphrase reports have their place in SEO and PPC, but you need to know what you are looking for. Most often you'll really want a keyphrase report rather than the keyword report.
It's interesting to note that Google Analytics has a keyword report, but it's actually a keyphrase report. Google Analytics doesn't have a true keyword report.