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There is a paucity of articles in the surgical literature demonstrating transfer validity (transfer of training). The purpose of this study was to assess whether skills learned on the ArthroSim virtual-reality arthroscopic knee simulator transferred to greater skill levels in the operating room.Postgraduate year-3 orthopaedic residents were randomized into simulator-trained and control groups at seven academic institutions. The experimental group trained on the simulator, performing a knee diagnostic arthroscopy procedure to a predetermined proficiency level based on the average proficiency of five community-based orthopaedic surgeons performing the same procedure on the simulator. The residents in the control group continued their institution-specific orthopaedic education and training. Both groups then performed a diagnostic knee arthroscopy procedure on a live patient. Video recordings of the arthroscopic surgery were analyzed by five pairs of expert arthroscopic surgeons blinded to the identity of the residents. A proprietary global rating scale and a procedural checklist, which included visualization and probing scales, were used for rating.Forty-eight (89%) of the fifty-four postgraduate year-3 residents from seven academic institutions completed the study. The simulator-trained group averaged eleven hours of training on the simulator to reach proficiency. The simulator-trained group performed significantly better when rated according to our procedural checklist (p = 0.031), including probing skills (p = 0.016) but not visualization skills (p = 0.34), compared with the control group. The procedural checklist weighted probing skills double the weight of visualization skills. The global rating scale failed to reach significance (p = 0.061) because of one extreme outlier. The duration of the procedure was not significant. This lack of a significant difference seemed to be related to the fact that residents in the control group were less thorough, which shortened their time to completion of the arthroscopic procedure.We have demonstrated transfer validity (transfer of training) that residents trained to proficiency on a high-fidelity realistic virtual-reality arthroscopic knee simulator showed a greater skill level in the operating room compared with the control group.We believe that the results of our study will stimulate residency program directors to incorporate surgical simulation into the core curriculum of their residency programs.