Do you have a wired USB keyboard lying around that you could use to test? You would need a free USB-C port and a USB-A to USB-C adapter. If an external wired board works, and the rest of the computer funcitons seem fine, that suggests a keyboard hardware error.
USB-C to USB Adapter - Apple or a cheaper generic one.
This sentence raises a more serious issue:
My MacBook Air m3 keyboard randomly stopped working.
Sporadic or progressive loss of function could indicate a serious battery issue that falls under the CANNOT WAIT!" category. Check your battery for swelling NOW. Symptoms:
— Unexpected trackpad and/or keyboard behavior.
— The gap between the display and the deck is not even when the display is closed.
— The gap between the bottom plate and chassis is uneven in places.
— Some of the screws that hold the bottom plate have popped out.
— The trackpad surface is higher than the surrounding deck surface.
— The computer "rocks" a bit on a known flat surface†.
† I find solid-surface and granite countertops very effective flat test surfaces.
Swelling increases daly, and enough damage done to other internal components can lead to an irreparable computer is service is delayed. Have Apple evaluate as soon as possible if you find one the above symptoms.
