MacBook Air stuck on start-up screen - cannot login

Question

Macbook Air - 3 months old. It was shut down ok but now when trying to login the username and password fields remain blank when typing in. After hitting a few keys it acts like one key is stuck (it isn't) and random characters get input into the field until it reaches the field limit. This after touching a key, any key, once.
The result is that obviously it is impossible to login. I have checked with an external keyboard and the same behaviour is present. Any ideas as to what could be causing this? Not really possible to troubleshoot or fix it if login is impossible.

Answer 1

Reinstalling OS X Without Erasing the Drive
Boot to the Recovery HD: Restart the computer and after the chime press and hold down the COMMAND and R keys until the menu screen appears. Alternatively, restart the computer and after the chime press and hold down the OPTION key until the boot manager screen appears. Select the Recovery HD and click on the downward pointing arrow button.
Reinstalling OS X Without Erasing the Drive
Repair the Hard Drive and Permissions: Upon startup select Disk Utility from the main menu. Repair the Hard Drive and Permissions as follows.
When the recovery menu appears select Disk Utility and press the Continue button. After Disk Utility loads select the Macintosh HD entry from the the left side list.  Click on the First Aid tab, then click on the Repair Disk button. If Disk Utility reports any errors that have been fixed, then re-run Repair Disk until no errors are reported. If no errors are reported click on the Repair Permissions button. Wait until the operation completes, then quit Disk Utility and return to the main menu.
Reinstall OS X: Select Reinstall OS X and click on the Continue button.
Note: You will need an active Internet connection. I suggest using Ethernet if possible because it is three times faster than wireless.
Alternatively, see:
Reinstall OS X Without Erasing the Drive
Choose the version you have installed now:
OS X Yosemite- Reinstall OS X
OS X Mavericks- Reinstall OS X
OS X Mountain Lion- Reinstall OS X
OS X Lion- Reinstall Mac OS X
     Note: You will need an active Internet connection. I suggest using Ethernet
                 if possible because it is three times faster than wireless.