Arachne
Initially, Athena disguised herself as an old woman, and whilst praising the work of Arachne, also sought to have the weaver acknowledge that her gift came from the gods. Again, Arachne declined to give proper praise to Athena, and even boasted that she could best the goddess in a weaving contest.
No god or goddess of Mount Olympus would refuse such a challenge, and Athena shed her disguise, to reveal herself for who she was.
Arachne was somewhat taken aback, but she would not display any humility nor ask for forgiveness, and so the contest began.
https://www.greeklegendsandmyths.com/arachne.html
At the end of the contest two endings are often told, both ending with Arachne hanging herself and Athena being a bit over reactive.
Arachne as Winner
Arachne wins and Athena is angered by such a decision and destroys Arachne's tapestry and then starts to beat the hell out of her with her tools. This leads Arachne to hang herself.
Arachne as Loser
Arachne can't take the pain of the loss as she was so respected in Lydia that even the nymphs came to see her! So she hangs herself.
The End
Athena loosens the noose and drips a potion Hekate gave to her over Arachne, transforming her into a spider. She didn't do this out of compassion, mind you, she did it to show the gods can never be bested.
Arachne and the Rebellious Flame
Her story is of young hubris and humility. Even though she lost (in certain retellings), Arachne still went toe-to-toe with Athena. Yes, she may have had hubris, but it wasn't without its merits. Being so young yet praiseworthy, for her skill rather then her beauty, is a sign of just how dedicated she was to her craft. She can teach us about passion, perseverance, and skill developed through time.
Much like Prometheus, Arachne was punished not for actually doing anything criminal nor morally negative, but for speaking out against the gods. They were punished for speaking a truth and challenging the highest of authority. Through their suffering we learn a valuable lesson - in spite of the consequences, speaking and acting on one's truth is the most powerful gift of all.
Source: Athens & Beyond website