Since Ruby is not interpreted in your browser like JavaScript, it cannot do what you are trying to do by itself. The browser never gets to see any of your Ruby code but only the resulting HTML (and JS) after your controller finished the appropriate method for a request.
Rails is REST based, so each request is executed separately and no state is kept between requests, save for the information in a cookie or similar means. It is not constantly running, waiting for a reply or something like that.
However, you can simply embed JS code like you posted within your Ruby templates. This JS can then check for a keypress event and send a new (AJAX) request to the server for some additional actions. You will need to process the returned values and manually display them using JS code.
If your page or application would make heavy use of such dynamic features, other languages might be a better fit.