I came across this overview of a talk given by a CalTech student which claims that the proof of Arzela-Ascoli given in Carothers' "Real Analysis" is incorrect. I've been trying to find the flaw for some time now but I don't see it. Maybe there isn't one?
The usual proofs I've seen involve obtaining a countably dense subset (via separability) and making a diagonal argument to find a subsequence, but this one does not do that.
Here is the proof (of the just the converse direction because the forward direction is simple):
Arzela-Ascoli Theorem 11.8 : Let $X$ be a compact metric space, and let $\mathcal{F}$ be a subset of $C(X)$. Then $\mathcal{F}$ is compact if and only if $\mathcal{F}$ is closed, uniformly bounded, and equicontinuous.
Proof. ($\impliedby$) $ \ $ Suppose $\mathcal{F}$ is closed, uniformly bounded, and equicontinuous and let $(f_n)\in\mathcal{F}.$ We need to show that $(f_n)$ has a uniformly convergent subsequence.
First note that $(f_n)$ is equicontinuous. Thus given $\epsilon>0, \exists \delta >0: d(x,y)<\delta\implies |f_n(x)-f_n(y)|<\epsilon/3, \forall n$.
Next since $X$ is totally bounded, $X$ has a finite $\delta$-net, i.e, there exists $x_1,\ldots, x_k\in X$ such that each $x\in X$ satisfies $d(x,x_i)<\delta$. Now since $(f_n)$ is also uniformly bounded, each of the sequences $(f_n(x_i))_{n=1}^{\infty}$ is bounded in $\mathbb{R}$ for $i=1,2,\ldots, k$.
Thus by passing to a subsequence of the $f_n$ (and relabeling), we may suppose that $(f_n(x_i))_{n=1}^{\infty}$ converges for each $i=1,2,\ldots, k$.
In particular, we can find some $N$ such that $|f_m(x_i)-f_n(x_i)|<\epsilon/3$ for any $m,n\geq N$ and any $i=1,2,\ldots, k$.
And now we are done! Given $x\in X$, first find $i$ such that $d(x,x_i)<\delta$ and then whenever $m,n\geq N$, we will have \begin{align*} &|f_m(x)-f_n(x)|\\ &\leq|f_m(x)-f_m(x_i)|+|f_m(x_i)-f_n(x_i)|+|f_n(x_i)-f_n(x)|\\ &<\epsilon/3+\epsilon/3+\epsilon/3\\ &=\epsilon \end{align*}
That is, $f_n$ is uniformy Cauchy, since our choice of $N$ does not depend on $x$. Since $\mathcal{F}$ is closed in $C(X)$ by assumption, it follows that $f_n(x)$ converges to some $f\in\mathcal{F}$, uniformly.