Thinking of going to Key West for 4th of July. Are there a lot of special events ( fireworks, outdoor concerts , etc,) going on then ?

check www.keywest.com for a list of events. Yes, I think they do have fireworks.

see if you can get a hotel room and what the rates are before you get too far in your planning Key West is always party town.

They have a one day party planned at the Casa Marina on the 4th with firworks at the closing. Nothing more goes on.

We were there last year to take advantage of the cheaper rates in the summer. We had a great time. Expect a thunderstorm in the afternoon that lasts about 15-20 minutes and then everything clears up. With regards to events on the 4th, there wasn't too much planned. We hopped on a boat and went to the southside of the island where they had a fireworks show. It wasn't quite the show you would see in DC but it was still fairly impressive.