$(\'a#next\').click(function() { var tags = $(\'input[name=tags]\'); if(tags.val()==\'\'){ tags.addClass(\'hightlight\'); return false; }else{
Sounds like the fade is moving your focus, hence the cursor no longer being there. Try this
$('input#tags').keypress(function() { $('#formcont').fadeIn('slow'); $('#next').hide('slow'); $(this).focus(); });