Now my blog is not hosted on WordPress.com but Akismet needs an API key to work. Actually as it turns out, Akismet just needs any wordpress.com API key to function.
Head over to http://wordpress.com/signup/ and sign up for an account. Choose the option “Just a Username please”
Check your email and you should find your API key given at the bottom.
Enter the key in your Plugins >> Akismet Configuration page.
Thats it Akismet has been configured and should start taking care of your spam now !