The sponsored words then appear as special links alongside the search results thrown up by a user's search.
The AdWord service is paid for by what is called a "cost-per-click" basis. An advertiser will only pay when its ads are clicked on.
It allows advertisers to get a potentially much wider audience as they buy up dozens of words associated with their brands.
Omid Kordestani, Google's senior vice-president of worldwide sales and field operations, said: "The AdWords programme is based on the same high quality and relevance standards that Google users experience from our objective web search results. AdWords provides substantial value to our thousands of UK advertisers and delivers helpful information to our users."
AdWords is designed to offer a simple advertising answer for small and large businesses in any industry. The AdWords self-service interface requires only £5 to start and campaign management and client services are available for larger advertisers and agencies.
Advertisers can target ads by country or language, reaching 250 countries and six languages.
The launch of the UK service comes a year after Google opened its UK office, the company's first outside the US.
Google's UK advertisers include Lloyds TSB Insurance, Kelkoo, BT, British Gas, Opodo, British Airways, Ford and Virgin.
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