Arthroscopic surgery is performed most commonly on the knees, and also on ankles, shoulders, wrists, elbows, and hips. Knee joints are large enough to allow free movement of arthroscopic instruments and therefore are ideal for the benefits of this type of examination and treatment. The technique is valued because it allows surgeons to see inside the joint through incisions as tiny as a quarter of an inch (about 1 cm) rather than the large incisions that open surgery procedures require. The accuracy of arthroscopy is said to be 100% for diagnosis compared to diagnostic imaging such as MRI. Arthroscopic surgery may be used to relieve mechanical joint problems, such as buckling, stiffness, or locking, and can preclude or delay the need for more aggressive surgery such as a joint replacement.

In arthroscopic surgery, an orthopedic surgeon uses a pencil-sized arthroscope—a fiber-optic instrument fitted with a lens, a light source, and a miniature video camera—to see inside a joint. Advanced fiber optics allow even more detail to be seen than in open surgery, often identifying problems that may have been difficult to diagnose with other methods. The arthroscope transmits highlighted images of the structures to a television monitor in the operating room. The surgeon is able to view the entire examination, getting a full view of the joint, its cartilage, and surrounding tissue. The type and extent of the injury can be determined and repair or correction can be performed if necessary. Some of the most common joint problems diagnosed and treated with arthroscopic surgery are:

synovitis (inflamed joint lining) of the knee, shoulder, elbow, wrist, or ankle
injuries to the shoulder, such as rotator cuff tendon tears, impingement syndrome, and dislocations
injuries to the knee, such as meniscal (cartilage) tears, wearing down of or injury to the cartilage cushion, and anterior cruciate ligament tears with instability
injuries to the wrist, such as carpal tunnel syndrome
loose bodies of bone and/or cartilage in the knee, shoulder, elbow, ankle, or wrist
joint damage caused by rheumatoid arthritis or osteoarthritis

Arthroscopic procedures are performed in a hospital or outpatient surgical facility by an orthopedic surgeon. The type of anesthesia used (local, spinal, or general) varies, as does the length of the procedure; both depend on the joint that will be operated on, the type and extent of the suspected joint injury, and/or the complexity of the anticipated repair. Arthroscopic surgery rarely takes more than an hour. Most patients who have arthroscopic surgery, whether diagnostic or corrective, are discharged within the same day; some patients, depending on the complexity of the surgery or their post-operative condition, may stay in the hospital one or two days.

Considered the most important orthopedic development in the twentieth century, arthroscopic surgery is widely used. The American Association of Orthopedic Surgeons reports that it is performed by 80% of all orthopedic surgeons. The use of arthroscopic surgery on famous athletes has been well publicized. Although arthroscopic surgery was initially only a diagnostic tool used prior to open surgery, the availability of better instruments and techniques has encouraged its use to actually treat a variety of joint problems, often avoiding more complicated surgeries with longer recovery times. New techniques under development are likely to lead to other joints being treated with arthroscopic surgery in the future. Laser technology has been introduced as a treatment option in arthroscopic surgery and other advanced technologies are being explored.