A knob assembly includes a light guide and a control knob that is independently rotatable relative to the light guide. The light guide is positioned at an aperture formed on a surface such that the light guide receives light emitted by a light source positioned below the surface along a vertical direction. The light guide also defines a guide opening, and further includes an opaque and translucent region. The control knob defines a light opening and is rotatably coupled to a stem extending through the guide opening. The control knob is rotatable between a first and second position. In the first position, the light opening is positioned entirely over the opaque region of the light guide along the vertical direction. In the second position, the light opening is positioned entirely over the translucent region of the light guide along the vertical direction. A related cooktop appliance is provided.