Avoid displaying keywords as images. Searchbots can't read the text displayed on images and so your site won't be ranked for keywords designed as images. It's also important to use link text (text that describes the information on the page where a link points), and not the words "click here."
In the section of this page outlined in red, you can see some text and images. To determine if text is an image, try to highlight the text. In the preceding paragraph, you can highlight any of the words you see. In the following paragraph, the underlined text is an image, as are all the appearances of a certain type of pasta. As a result, search engines -- both internally (i.e., on this site) and externally (e.g., Google, Yahoo, etc.) would not be able to index this article for this favorite pasta dish. If you'd care to test this theory, try doing a search on this site for the pasta word highlighted below.
In all occurences on this page, the word "lollygagging" is text and not an image. Because lollygagging is a word in this text, you will be able to find it when you do a search on this site.
Here's an example of lollygagging as a link. The three occurrences of this word on this page -- especially in boldface and as a link -- might actually help this page get ranked in search engine results.