Knee arthroscopy is generally performed under spinal anaesthesia. The advantage of spinal anaesthesia is that it allows the patient to follow the events happening in the operating room. If you like, you can also watch the orthopaedic surgeon perform the arthroscopic surgery. If you would prefer to sleep during surgery, the anaesthesiologist can give you a mild sleep medication in addition to the spinal anaesthesia.
Your anaesthesiologist will meet with you before the surgery to discuss all of this in advance. You can naturally let the anaesthesiologist know your preferences at that time.