TeamViewer keyboard input not working

I've had the same problem before on Firefox (way back on 3.5). I've come to believe that this is just caused by the fact that Firefox runs virtually like a VM interface-wise. Instead of using real OS widgets, it copies them and re-implements the look'n'feel using XUL (XML User interface Language). Supposedly this makes porting Firefox and its addons much easier. I wouldn't be surprised if they implemented keyboard hooks nonstandardly too, so when Firefox pauses, everything does.

What I suggest you do is either switch to another browser (simmer down, Firefox diehards), bear with it, or make Firefox itself faster using the standard ways (cache clearing, removing history, yadayada).

I'm not 100% of the root cause (I suspect it's a Teamviewer version disparity), but the solution was, on the client side, to go to Options > Remote control and select Custom Settings under Quality. Then, under custom settings, check the box for Improve application compatibility.