Are you fighting or watching? If fighting, it's probably just fight trunks (if bareknuckle) or tape/wraps with open gloves and possibly ankle wraps. If watching, doesn't matter. Although if you're close to the cage, there might be blood and sweat flying. Also, if you're in a country where cagefighting is illegal, the room's temperature probably isn't the best, so dress appropriately (basements get pretty hot and stuffy when there's a crowd in them).
Source: Semipro fighter
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it is so they don't get into the crowd if they did it could hurt someone (most cage fights also have cameras on the cage for close up action. and its more violent so more people will like it)