The main pathology in traumatic anterior instability of the shoulder is a Bankart lesion and capsuloligamentous laxity. Success in the treatment of glenohumeral instability mainly relies on an anatomical attachment of the fibrocartilaginous labrum and restoration of tension of the capsuloligamentous structures. Suture anchors are preferred for the fixation of soft tissues. Excessive capsular laxity can be treated by capsular plication or thermal capsulorrhaphy. Arthroscopy enables examination and repair of the glenohumeral structures, with several advantages over open techniques, including less morbidity and pain, shorter hospitalization, better cosmetic appearance, and a lower complication rate. These advantages have contributed to the growing acceptance of arthroscopic treatment in dealing with traumatic anterior glenohumeral instability. Moreover, its success rate has increased thanks to advances in technology and surgical techniques. Yet, appropriate selection of patients, the quality of capsulolabral structures, coexisting pathologies, and experience on the part of the surgeon are important factors in the success of arthroscopic treatment of anterior shoulder instability. This paper discusses the rationale for a treatment algorithm for arthroscopic applications together with recommendations about anterior instability of the shoulder.