Whether you plan on making knives by forging or the stock removal method there is a minimum amount of equipment that will be needed.

For forging you will need a heat source (forge), anvil, hammers and tongs. Regardless of the method used to produce your blades there will be some removal of excess steel. At it's most basic level this can be accomplished with files. A belt grinder will speed the process considerably. Forged to shape blades will have less stock to remove as the shape, distall taper and bevels are put in with a hammer. A good bench vise is a wise investment. Drills and some sort of saw will certainly come in handy. These can be manual or power equipment.
For finishing the blade you can use various grits of wet and dry sandpaper. A good satin finish can be attained on the blade with a bit of practice. Epoxy will be necessary to attach the handle.

The equipment currently used in my shop is as follows: Gas Forge (home made), Post Vise, Peter Wright Anvil (150 lb.), 25 Ton Hydraulic Press, assorted hammers and tongs, vermiculite in a large container for annealing the blades. The annealing process softens the blade so that it can be ground, filed, etc. I use an arc welder to put together stock for my Damascus and the hydraulic press is used to make the Damascus Steel.

My finish shop contains 2 grinders (variable speed Burr King and a Wilton Square Wheel) metal and wood cutting bandsaws, bench vise, fluorescent and incandescent lighting, various tools and jigs (labor saving devices).

There are shops with a lot more equipment such as mills and lathes but I do just fine in my shop.