Clean the damaged area of knockdown texture by scraping away any loose texture material with a paint scraper. Get the base wall material clear of any remnants of the previous covering.
Sand approximately 3 inches around the perimeter of the cleaned area with fine-grit sandpaper. This makes it easier to hide the location of the repair and blend over any seams.
Spread new drywall compound over the wall with a trowel to a thickness that matches the original covering. Thread the material over the existing wall to hide the transition junction. Allow the material to set for approximately 15 minutes.
Slide an 8-inch drywall knife in twisting and circular patterns in the wet compound. When done correctly, this process looks similar to swirled cake frosting. Avoid making the same movement with the knife each time and reverse your knife direction often.
Leave the textured repair to dry overnight, then paint the wall section with a paint color to match the rest of the existing wall.