I am sure that there are many different ways to interpret George Orwell's essay "A Hanging." For me, though, the main idea is the surreal effect of seeing someone die and knowing that you are a part of it.

At the beginning of the essay, Orwell seems to be observing the whole process from a distance. He describes how the prisoners and the warders looked and what they said to each other, but he doesn't tell us what his own thoughts are. The fact that a man is about to die doesn't seem to feel real to him.

It isn't until the dog appears that we start to feel a shift in the essay. The dog has no clue what is going on; he doesn't know that the men are all taking another man off to the gallows to kill him. He is just happy to see everyone and is jumping all over them, as dogs do. Everyone is at a loss about what to do with the dog at first, partially because it seems too strange to have such a normal thing happening in such an abnormal scene, but then they manage to catch him and Orwell keeps him off to the side with his handkerchief: his first real involvement in this event.

The dog seemed to wake Orwell up to the humanity of everyone involved, but then the prisoner's actions take this a step further. When Orwell sees the man step around a puddle just like he himself would, just like anyone would, he realizes for the first time that this is a human being, and that they are about to end his life.

It is curious, but till that moment I had never realized what it means to destroy a healthy, conscious man. When I saw the prisoner step aside to avoid the puddle, I saw the mystery, the unspeakable wrongness, of cutting a life short when it is in full tide. This man was not dying, he was alive just as we were alive. All the organs of his body were working — bowels digesting food, skin renewing itself, nails growing, tissues forming — all toiling away in solemn foolery. His nails would still be growing when he stood on the drop, when he was falling through the air with a tenth of a second to live. His eyes saw the yellow gravel and the grey walls, and his brain still remembered, foresaw, reasoned — reasoned even about puddles. He and we were a party of men walking together, seeing, hearing, feeling, understanding the same world; and in two minutes, with a sudden snap, one of us would be gone — one mind less, one world less.

That being said, he doesn't stop the act from happening. The man is hanged, his life is taken and everyone who led him to the noose is responsible in their own way. Then, once he is dead, bizarrely, everyone is relieved. They begin to chat and laugh, none of them louder than Orwell himself, emphasizing how surreal it all is. Orwell is back to blocking out the reality of it, which is perhaps the only way he and the others can deal with the enormity of what they have just done.

"A Hanging" represents a savage indictment of what Orwell sees as the barbarism of capital punishment. But more specifically, Orwell wishes to make it clear from the outset that the death penalty doesn't simply damage those convicted of capital crimes, but also morally corrupts those responsible for the administration of justice, those forced to witness such unspeakable horrors. This message is effectively conveyed by the purposely dark, brooding atmosphere of the story, which casts a gloomy pall over proceedings. Capital punishment, and all that it entails, is everyone's burden.

The narrator is a colonial policeman. This brings a significant element of autobiography to the story. Orwell worked as a British colonial policeman in Burma, and was often deeply disturbed by what he saw, especially in relation to the unfair treatment of the indigenous population. Although the narrator of the story is somewhat apart from what's happening, his evident revulsion at what unfolds before his eyes indicates that the execution has a profound effect upon him. Crucially, however, it's not just the narrator who's adversely affected by what he sees:

Everyone had changed colour. The Indians had gone grey like bad coffee, and one or two of the bayonets were wavering. We looked at the lashed, hooded man on the drop, and listened to his cries — each cry another second of life; the same thought was in all our minds: oh, kill him quickly, get it over, stop that abominable noise!

But revulsion soon gives way to relief, and—appropriately enough—gallows humor:

We went through the big double gates of the prison, into the road. ‘Pulling at his legs!’ exclaimed a Burmese magistrate suddenly, and burst into a loud chuckling. We all began laughing again. At that moment Francis's anecdote seemed extraordinarily funny. We all had a drink together, native and European alike, quite amicably. The dead man was a hundred yards away.

The only way that the men can deal with what they've just witnessed is through trying to laugh it all off and getting drunk. Although they can put some physical distance between themselves and the executed man, they cannot truly escape the horror of what they have seen. Their souls have been corrupted, and no amount of hard-drinking camaraderie is going to change that simple fact one iota.

In my opinion, the main point of this essay is how immense of a thing it is to kill a human being.  You can see this in a couple of ways in the essay.

First, you see it in Orwell's discussion of that very idea: he talks about how strange and wrong it is that the guy could be walking along, alive, and two minutes later he'll be dead.

It is curious, but till that moment I had never realized what it means to destroy a healthy, conscious man. When I saw the prisoner step aside to avoid the puddle, I saw the mystery, the unspeakable wrongness, of cutting a life short when it is in full tide.

Then, the idea comes up again after the hanging is over.  The people who participated in it are acting strangely. Orwell himself feels the need to laugh. It's like they are a bit hysterical or on an adrenaline high because they know how terrible (I don't mean immoral here--I mean something more like "inspiring terror") a thing they have done.