Removing, adding, and using items from lists

Room.al.items().remove(item); doesn't make sense, as Room doesn't have a static field al ... or a method items()

Instead, I think you want to use current.getItems(), but personally, I'd add a addItem and removeItem method to your Room to make it easier to use.

I'd also get rid of the getItems method, no-one needs direct access to it, instead, Room should manage the interactions with the items List

private void take(String item) {
    if (current.contains(item) == true) {
        current.removeItem(item); // can't get this to work
        inventory.add(item);
        System.out.println("You picked up the " + item + "and stashed it away");
    } else {
        System.out.println("Unknown object '" + item + "'.");
    }
}

private void drop(String item) {
    if (current.contains(item) == true) {
        inventory.remove(item);
        current.addItem(item); // or this
        System.out.println("You dropped the " + item + "and left it in the " + current);
    } else {
        System.out.println("Unknown object '" + item + "'.");
    }
}

Your Room should also be a little more dumb, that is, when you want to move, the Room should simply return the room in the direction you want to move and then let the Game make the decisions about how to process it.

You should also be able to determine if the Room is locked simply, this makes it easier to code

public class Room {

    //...

    public boolean isLocked() {
        return key != null;
    }

    public String requiredKey() {
        return key;
    }

    /**
     * Try to move in the given direction from this room.
     *
     * @param dir Should be "north", "east", "south" or "west".
     * @return the new room.
     */
    public Room getNextRoom(String dir) {
        Room nextRoom = null;

        if (dir.equals("north")) {
            nextRoom = north;
        } else if (dir.equals("east")) {
            nextRoom = east;
        } else if (dir.equals("south")) {
            nextRoom = south;
        } else if (dir.equals("west")) {
            nextRoom = west;
        } else {
            System.out.println("Error: unknown direction " + dir);
        }
        return nextRoom;
    }

    public boolean contains(String item) {
        return items.contains(item);
    }

    public void addItem(String item) {
        items.add(item);
    }
    public void removeItem(String item) {
        items.remove(item);
    }
}

Now, when you move, you ask the current Room for the room in the direction you want to move, if it's null, you can't move in that direction, then you check to see if the room is locked AND if the user has the required key to unlock it, if so, move to that room. If the room is locked and they don't have the key, display a error message, otherwise, move to the next room

} else if (line.startsWith("go ")) {
    String dir = line.substring(3);
    Room next = current.getNextRoom(dir);
    if (next == null) {
        System.out.println("You cannot go " + dir + " from here.");
    } else {
        if (next.isLocked() && inventory.contains(next.requiredKey())) {
            current = next;
            System.out.println("You use the " + next.requiredKey() + " to unlock the next room...");
            current.describe();
        } else if (next.isLocked()) {
            System.out.println("That room is locked and you don't have the required key");
        } else {
            current = next;
            current.describe();
        }
    }
} else if (line.startsWith("take ")) {

One more thing I added to your code is the ability to set the required key for a given

Runnable code...

import java.util.ArrayList;
import java.util.List;
import java.util.Scanner;

public class Game {

    private Room yard;
    private Room frontdoor;
    private Room hallway;
    private Room bathroom;
    private Room lounge;
    private Room kitchen;
    private Room bedroom;
    private Room basementdoor;
    private Room basement;
    private Room exit;
    private Room current;
//create an inventory
    private ArrayList<String> inventory = new ArrayList<String>();

    public Game() {
        yard = new Room("You're standing in open area.\n"
                        + "There is a house to the north.\n");

        frontdoor = new Room("You come to an old timber door, but it's locked.\n"
                        + "There's a key on the ground. Talk about security...\n"
                        + "There's a yard to the south.\n");
        frontdoor.setKey("Front door key");

        hallway = new Room("A hall stretches out into darkness.\n"
                        + "There is a small flicker of light to the North.\n"
                        + "There's a faint dripping sound to the west"
                        + "There's a strange smell comming from the east");

        bathroom = new Room("You enter what looks like a bathroom. It doesn't look like anyones cleaned it it months.\n"
                        + "There's four numbers scratched into the wall - '1517'.\n"
                        + "The hall is to the east.");

        kitchen = new Room("You come into a kitchen, there's moldy food still in grocery bags on the bench.\n"
                        + "You see a sandwhich and pick it up to investigate. Fortunately it looks fresh, and you're pretty hungry.\n"
                        + "The hall is back to the west.");
        kitchen.addItem("Mouldy Sandwhich?");

        lounge = new Room("You come to a dimly lit loungeroom.\n"
                        + "The couches have been toppled over, a book case lies fallen on the floor. The embers are still hot and flickering in the fireplace.\n"
                        + "There's a door on the western wall.");

        bedroom = new Room("You walk into a bedroom.\n"
                        + "There's snoring comming from a huddled lump on the bed. Better be quiet.\n"
                        + "There's a large metal door on the southern wall");

        basementdoor = new Room("There's no breaking through this thing, it's too solid.\n"
                        + "There's a small keypad next to the door. Hmm?\n");

        basement = new Room("The code unlocks the door. You climb down a dimly lit staircase into what looks like a basement.\n"
                        + "Suddenly, you hear some yelling from upstairs and some footsteps making their way down the staircase!\n"
                        + "There's a window to north, quick!\n");

        exit = new Room("You crawl through the window, out into the open and run down the street.\n"
                        + "Why did you even go into that house in first place?\n");

        current = yard;

        //Connect the rooms
        yard.connectNorth(frontdoor);
        frontdoor.connectNorth(hallway);
        hallway.connectNorth(lounge);
        hallway.connectWest(bathroom);
        kitchen.connectWest(hallway);
        lounge.connectWest(bedroom);
        basementdoor.connectNorth(bedroom);
        basement.connectNorth(basementdoor);
        basement.connectNorth(exit);
    }

    /**
     * Play the interactive text game.
     *
     * Reads commands from the given input, line by line.
     *
     * @param in
     */
    private void take(String item) {
        if (current.contains(item) == true) {
            current.removeItem(item); // can't get this to work
            inventory.add(item);
            System.out.println("You picked up the " + item + "and stashed it away");
        } else {
            System.out.println("Unknown object '" + item + "'.");
        }
    }

    private void drop(String item) {
        if (current.contains(item) == true) {
            inventory.remove(item);
            current.addItem(item); // or this
            System.out.println("You dropped the " + item + "and left it in the " + current);
        } else {
            System.out.println("Unknown object '" + item + "'.");
        }
    }

    public void play(Scanner in) {
        current.describe();
        while (current != exit) {
            String line = in.nextLine().toLowerCase();
            if (line.equals("quit")) {
                System.out.println("You gave up!");
                break;
            } else if (line.startsWith("go ")) {
                String dir = line.substring(3);
                Room next = current.getNextRoom(dir);
                if (next == null) {
                    System.out.println("You cannot go " + dir + " from here.");
                } else {
                    if (next.isLocked() && inventory.contains(next.requiredKey())) {
                        current = next;
                        System.out.println("You use the " + next.requiredKey() + " to unlock the next room...");
                        current.describe();
                    } else if (next.isLocked()) {
                        System.out.println("That room is locked and you don't have the required key");
                    } else {
                        current = next;
                        current.describe();
                    }
                }
            } else if (line.startsWith("take ")) {
                take(line.substring(5));
            } else if (line.startsWith("print inventory")) {
                System.out.print(inventory);
            } else {
                System.out.println("Unknown command '" + line + "'.  Try go/take/quit.");
            }
        }
    }

    /**
     * Starts the whole game.
     */
    public static void main(String[] args) {
        Game game = new Game();
        game.play(new Scanner(System.in));
    }

    public class Room {

        private String description;
        private Room north;
        private Room east;
        private Room south;
        private Room west;
//add a list of empty items to each room
        private ArrayList<String> items = new ArrayList<>();

        private String key; //null means no key

        public Room(String desc) {
            description = desc;
        }

        public void setKey(String key) {
            this.key = key;
        }

        /**
         * Connect the west exit of this room to the 'other' room. It automatically
         * makes the connection in both directions.
         *
         * @param other
         */
        public void connectWest(Room other) {
            this.west = other;
            other.east = this;
        }

        public void connectNorth(Room other) {
            this.north = other;
            other.south = this;
        }

        /**
         * Prints a description of this room and its contents.
         */
        public void describe() {
            final StringBuilder itemsString = new StringBuilder("");
            for (String item : items) {
                itemsString.append(" ").append(item);
            }
            System.out.println(itemsString.toString());
            System.out.println(description);
        }

        public boolean isLocked() {
            return key != null;
        }

        public String requiredKey() {
            return key;
        }

        /**
         * Try to move in the given direction from this room.
         *
         * @param dir Should be "north", "east", "south" or "west".
         * @return the new room.
         */
        public Room getNextRoom(String dir) {
            Room nextRoom = null;

            if (dir.equals("north")) {
                nextRoom = north;
            } else if (dir.equals("east")) {
                nextRoom = east;
            } else if (dir.equals("south")) {
                nextRoom = south;
            } else if (dir.equals("west")) {
                nextRoom = west;
            } else {
                System.out.println("Error: unknown direction " + dir);
            }
            return nextRoom;
        }

        public boolean contains(String item) {
            return items.contains(item);
        }

        public void addItem(String item) {
            items.add(item);
        }
        public void removeItem(String item) {
            items.remove(item);
        }
    }
}