<?xml version="1.0"?>
<ownershipDocument>

    <schemaVersion>X0303</schemaVersion>

    <documentType>4</documentType>

    <periodOfReport>2010-11-08</periodOfReport>

    <notSubjectToSection16>0</notSubjectToSection16>

    <issuer>
        <issuerCik>0000906193</issuerCik>
        <issuerName>KEY TECHNOLOGY INC</issuerName>
        <issuerTradingSymbol>KTEC</issuerTradingSymbol>
    </issuer>

    <reportingOwner>
        <reportingOwnerId>
            <rptOwnerCik>0001296321</rptOwnerCik>
            <rptOwnerName>BOUTSIKARIS JOHN C</rptOwnerName>
        </reportingOwnerId>
        <reportingOwnerAddress>
            <rptOwnerStreet1>C/O KEY TECHNOLOGY, INC.</rptOwnerStreet1>
            <rptOwnerStreet2>150 AVERY STREET</rptOwnerStreet2>
            <rptOwnerCity>WALLA WALLA</rptOwnerCity>
            <rptOwnerState>WA</rptOwnerState>
            <rptOwnerZipCode>99362</rptOwnerZipCode>
            <rptOwnerStateDescription></rptOwnerStateDescription>
        </reportingOwnerAddress>
        <reportingOwnerRelationship>
            <isDirector>0</isDirector>
            <isOfficer>1</isOfficer>
            <isTenPercentOwner>0</isTenPercentOwner>
            <isOther>0</isOther>
            <officerTitle>SVP GLOBAL SALES &amp; AFTERMARKET</officerTitle>
            <otherText></otherText>
        </reportingOwnerRelationship>
    </reportingOwner>

    <nonDerivativeTable>
        <nonDerivativeTransaction>
            <securityTitle>
                <value>Common Stock</value>
            </securityTitle>
            <transactionDate>
                <value>2010-11-08</value>
            </transactionDate>
            <deemedExecutionDate></deemedExecutionDate>
            <transactionCoding>
                <transactionFormType>4</transactionFormType>
                <transactionCode>A</transactionCode>
                <equitySwapInvolved>0</equitySwapInvolved>
            </transactionCoding>
            <transactionAmounts>
                <transactionShares>
                    <value>3284</value>
                    <footnoteId id="F1"/>
                </transactionShares>
                <transactionPricePerShare>
                    <value>0</value>
                </transactionPricePerShare>
                <transactionAcquiredDisposedCode>
                    <value>A</value>
                </transactionAcquiredDisposedCode>
            </transactionAmounts>
            <postTransactionAmounts>
                <sharesOwnedFollowingTransaction>
                    <value>68124</value>
                </sharesOwnedFollowingTransaction>
            </postTransactionAmounts>
            <ownershipNature>
                <directOrIndirectOwnership>
                    <value>D</value>
                </directOrIndirectOwnership>
            </ownershipNature>
        </nonDerivativeTransaction>
    </nonDerivativeTable>

    <derivativeTable></derivativeTable>

    <footnotes>
        <footnote id="F1">Represents restricted stock award the restrictions on which shall lapse on December 15, 2011 based on the achievement of certain performance criteria for the year ended September 30, 2011 and continued employment.</footnote>
    </footnotes>

    <remarks></remarks>

    <ownerSignature>
        <signatureName>/s/ John C. Boutsikaris</signatureName>
        <signatureDate>2010-11-08</signatureDate>
    </ownerSignature>
</ownershipDocument>
