KeySweeper is an Arduino device that can be concealed inside of a simple wall charger. This device is able to intercept and decrypt the keystrokes from Microsoft wireless keyboards. The device can then store the keystrokes locally or connect to a cell network and txt/email them to you.
The reason this is possible is because of the way that Microsoft is encrypting the traffic from the wireless keyboards. And what band of wireless they are using.
The wireless band is only slightly lower than the normal wireless bands of 2.4GHz so you can modified existing hardware to sniff at this frequency.
The encryption they used was a simple xor algorithm that uses the first 2 octets of the keyboards mac address. This would be a good enough encryption because there is no easy way to get the devices mac address because of how messages are sent. But unfortunately for Microsoft all of there chips have the same 4 leading mac address octets so decryption traffic is trivial.