Learn Finnish: Mikä tämä huono sana on?

In Finnish, question words like mikä go at the start, but the rest of the word order is flexible. Placing the verb on (is) at the end of an identification question like this is very common and natural. It literally flows as "What this bad word is?"

I learned that mitä also means "what". Why is it mikä here?

You use mikä for basic identification questions with the verb olla (to be). When you point at a whole, countable thing and ask "What is this?", you use mikä. You would use mitä if you were asking about an uncountable mass substance (like water or coffee) or using an action verb.

Could I say "Mikä on tämä huono sana?" instead?

Absolutely! Because Finnish word order is quite flexible, Mikä on tämä huono sana? is perfectly grammatically correct and means the exact same thing.

Why are tämä, huono, and sana all in their basic forms?

Because this is a simple identification question using the verb olla (to be). In these basic sentences, the subject you are asking about stays in its dictionary form (the nominative case).