A baker's cyst is a fluid-filled sac that forms behind the knee, often due to swelling from conditions like arthritis or a knee injury. It occurs when excess synovial fluid, which lubricates the joint, accumulates and creates a bulge. These cysts can cause discomfort, stiffness, or swelling in the knee area. While they are usually harmless and may resolve on their own, persistent or painful cysts may require treatment, such as drainage or addressing the underlying cause.