I dont know about lightening it, but if you go to a beauty supply store you guy buy bleach for that specific purpose, women usually buy it to cover up the dreaded mustache. It also works on your arms as well.
The only way you can lighten your arm hair would be to color it or bleach it. I wouldn't recommend either because putting bleach on your skin is not good for you and if you use color it would stain your skin and take a while to come off.
