An arena is a place where a contest takes place, with one person or team usually being declared the winner at the end.
Therefore, an arena in a dream is usually a setting for resolving a conflict. If you are confused about something or faced with a difficult choice in your life, you can find yourself in an arena in your dream.
Playing a sport in an arena is also your dreaming mind’s way of allowing you to release feelings of tension and frustration.
A dream of watching others playing a sport in an arena also signifies a conflict in your life. However, in this case, you are watching passively rather than participating, so the dream is either a sign that you feel you have lost control or a message that you need to do something yourself rather than sit back and watch others take over.