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Arthroscopy is one of the most challenging surgical skills to assess and teach. Although basic psychomotor arthroscopic skills, such as triangulation and object manipulation, are incorporated into many simulation exercises, they are not always individually taught or objectively evaluated. In addition, arthroscopic instruments, arthroscopy cameras, and the cadaver or joint models necessary for practice are costly.A low-cost arthroscopic simulator was created to practice triangulation, probing, horizon changes, suture management, and object manipulation. The simulator materials were purchased exclusively from national hardware stores with a total cost averaging $79. The universal serial bus (USB) camera is included in the total cost. Three residency programs accredited by the Accreditation Council for Graduate Medical Education were tested on the simulator. Replica boards were created at each institution. Participants included medical students (20), residents (46), and attending physicians (9).Construct validity—the ability to differentiate between novice, intermediate, and senior level participants—was obtained. On all tasks, junior residents scored at a statistically significant lower rate than senior residents and attending physicians.This cost-effective arthroscopic surgical simulator objectively demonstrated that attending physicians and senior residents performed at a higher level than junior residents and novice medical students. The results of this study demonstrate that this simulator could be an important training tool for resident education.