The former world number one retrieved a break in the second set to claim a 6-4, 6-4 win over the 39th-ranked Italian who dumped him out at the first hurdle in Madrid last month.
Djokovic is hunting the 100th title of his career on the eve of the French Open having not won a tournament since capturing Olympic gold in Paris last August.
“It’s great to be in the semi-finals again. Last year I played the semi-finals. Hopefully this year I can go at least a step further. That’s the goal,” said Djokovic.
Djokovic, who received a wild card to play in Geneva after skipping Rome, will meet British qualifier Cameron Norrie for a place in Saturday’s final.
The 24-time Grand Slam champion had not won a match on clay this season after also losing his Monte Carlo opener at the start of April to Alejandro Tabilo.
A single break early in the first set enabled Djokovic to take control, but the sixth-ranked Serbian had to rally from 4-1 down in the second.
He drew audible gasps from the crowd when he grabbed his right knee after stretching for a shot in the fifth game.
But Djokovic, who had surgery last year to repair a torn meniscus suffered at the French Open, quickly rebounded and let out a mighty roar as he broke to go 5-4 ahead before putting away Arnaldi.
He said an angry outburst after dropping serve helped him reset as he won the final five games.
“I think I’m playing really, really good tennis,” said Djokovic, who was presented on court with a chocolate cake topped with sparklers after his victory.
“Today it was a lot of tension on the court. A straight-sets win but it was much closer than maybe the score indicates,” he said.
“I was 4-1 down in the second. Somehow after that racquet breaking I didn’t lose a game and kind of found my optimal state and balance, mentally and emotionally,” he added.
Norrie ousted Australian fifth seed Alexei Popyrin 7-6 (8/6), 6-4 in the day’s last quarter-final.
Hubert Hurkacz put out top seed Taylor 6-3, 7-6 (7/5) earlier and will play Austrian qualifier Sebastian Ofner in the other semi-final.
The 128th-ranked Ofner came from behind to beat fourth seed Karen Khachanov 4-6, 6-4, 6-4. (AFP)
