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Hygroscopy refers to the tendency of a compound (such as sodium nitrate, or even more commonly, brown sugar) to absorb moisture from the air. If it absorbs enough water that it dissolves, it is called deliquescent. A list of hygroscopic compounds can be found in the categories section of this wiki.
Materials that are hygroscopic pose significant problems in most chemical processes.
This effect is undesirable in pyrotechnics, as hygroscopic materials burn much slowly, or may not burn at all. This is why potassium nitrate is used instead of sodium nitrate, as it's not hygroscopic, even though sodium nitrate has a slightly higher oxygen content per mass.
Hygroscopic salts, such as zinc chloride cannot be used in the synthesis of organometallic compounds if they are hydrated, as water will poison the synthesis. Such compounds must be kept anhydrous in air-tight containers or under dry inert gas away from air.
Powdered or grained hygroscopic compounds tend to harden inside the storage bottle as they absorb water from air, forming a solid block inside the bottle. This makes their extraction from the bottle difficult.
Some metal powders will oxidize in air much faster if wet.