A swollen knee, sometimes also referred to as 'water in the knee', occurs when there is an excessive amount of joint fluid in the knee. It is not a diagnosis but rather a symptom warning you that there is something wrong with your knee. It is the result of an inflammation of the membrane that is lining the inner surfaces of the knee (the synovial membrane). This inflammation, in turn, can be caused by a variety of conditions such as meniscal tears, osteoarthritis or rheumatoid arthritis.
A small amount of extra joint fluid is, in itself, hardly painful. In such cases pain can be caused by the underlying condition. Excessive joint fluid limits the range of bending of the knee and since the knee, upon bending, becomes less and less movable, fluid can get trapped which can lead to pain.
The treatment should always be directed towards the underlying condition, which must be diagnosed. Evacuation of the fluid is not meaningful as long as the underlying cause persists; the fluid promptly returns.