The simple item was for a locker that stored the binoculars in the crow's nest and was in the possession of a Scots officer who was taken off the luxury liner at the last moment.
In his haste, second officer David Blair forgot to hand the key over to his replacement and took it with him. As a result, none of the lookouts on board could use the binoculars, despite asking other officers for them.
Fred Fleet, a lookout who survived the disaster, later told the official inquiry that if the crew had had binoculars they would have seen the iceberg the ship struck sooner. When asked by a US senator chairing the inquiry how much sooner, Mr Fleet replied: "Enough to get out of the way."
The 95-year mystery has resurfaced after the key was made available for sale at auction. The key is being sold by Mr Blair's descendants, along with a postcard he wrote to his sister about his disappointment on missing out on the trip. The two items are expected to fetch up to £70,000.
Alan Aldridge, of auctioneers Henry Aldridge and Sons, who specialise in Titanic memorabilia, said: "This is one of the most important artefacts from the Titanic to have come to light.
"Mr Blair was the second officer who was in charge of the crow's nest and he had the key, which we believe was for the binoculars locker in the nest.
"A few days before the Titanic sailed, he was bumped off the ship, which probably saved his life. But he carried this key off with him and forgot to hand it to his replacement."
Mr Blair, of Broughty Ferry, who was 37-years-old at the time, sailed on the Titanic from Belfast to Southampton on 3 April, 1912. He was due to sail on the doomed vessel's maiden voyage to New York on 10 April, but was told he wasn't going after the White Star line transferred chief officer Henry Wilde to the ship.
Mr Fleet told the inquiry he remembered Mr Blair with binoculars on the Belfast-to-Southampton trip, but there were none for the trip from Southampton to New York.
Titanic historian David Brown said he was sceptical about whether the key could have made a difference. "I tend to doubt it. I don't think they would have locked them up or that the key was something they would have forgotten.
"Landsmen have this idea that if the guys had been staring through binoculars up in the crow's nest they would have seen the iceberg and there would have been no accident. Anyone who has been on watch duty knows that's not true."
He added that in 1912 British binoculars did not have coated lenses and would have worsened vision in low light.
Karen Kermuda, the vice-president of the Titanic Historical Society, said: "It wouldn't make sense to lock binoculars in a box when they need to be readily available."
COLLECTING MEMORIES
The 46,000-tonne Titanic struck an iceberg in the north Atlantic at 11:45pm on 14 April and sank at 2:20am on 15 April. Some 1,522 people drowned. Fewer than half that number survived.
The enduring fascination of the tragedy, and the stories of the victims and survivors, have created a minor industry both for those who study the ship's story and collectors of memorabilia.
Henry Aldridge and Son, the Wiltshire auctioneer, is offering David Blair's key and postcard in its September sale, as handed down by his descendants. The firm sells high-end Titanic and ocean-liner collectibles to a world-wide market. It boasts of holding the world record for a Titanic item. The post office keys of the ship's postmaster, Oscar Woody, sold for £101,000.
When the vessel struck, Mr Woody and his crew, who were celebrating the veteran postman's birthday, rushed to the mail room to try to move 400,000 letters to a higher deck.
None survived, but the keys were recovered from Woody's body and given to his widow.
The previous record was held by a miniature portrait retrieved from the ocean, which sold for £58,000. The portrait belonged to passenger Helen Churchill Candee, travelling to America to see her son.
The US authoress gave the miniature of her mother to a friend as the ship was sinking because she had no pockets, but went on to survive.
Next month's sale includes an "extremely rare Titanic launch ticket", expected to fetch £10,000 to £15,000.
There is also an RMS Titanic onboard postcard sent by a third-class passenger, Henry Olsen, which is expected to sell for a similar amount.
In recent auctions an onboard letter written by first class passenger Alfred Rowe sold for £28,000.
