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Keys were used on locked chests in diablo 2, and were the only way to open the chests. Assassins could bypass this by nature, however. Keys were not added to diablo 3.

Bashiok made a comment on keys and chests in February, 2009:

Having keys that are dropped for specific uses, that have more story and questing elements tied to them are definitely possible. In a general 'designery' way Leoric's crown was essentially a key used to unlock the boss fight in the BlizzCon demo. So I don't think it's out of the question to then have a literal key be used for more quest-centric chest unlocking purposes.
That's of course completely separate from the generic dropped keys and their ability to open randomly spawned 'locked' chests. We don't currently have keys and locked chests, but... we're not completely opposed to them either.
Something I posted about a long time ago, which were just ideas being thrown around internally, is the idea of having multiple tiers of chests with subsequently lower spawn rates, and subsequently increased chances for dropping better and better items. At that point keys sort of become this unnecessary burden, because you already had the amazing luck of having the rarest chest type in the game spawn, it's probably not all that cool to then also say "Now find a key for it!"