Heat oven to 400° F. In a large bowl, combine the beef, panko, milk, eggs, 1 teaspoon salt, and ½ teaspoon pepper and mix well. Form the mixture into 18 meatballs.
Whisk the marinara sauce and 1 cup water in a 2½-quart baking dish until well blended. Add the spaghetti and stir to evenly coat in the sauce; arrange in an even layer. Add the meatballs and basil sprigs on top. Cover and bake, gently stirring once or twice, until the pasta and meatballs are cooked through, 50 to 60 minutes.
Top with the cheese and broil, uncovered, 6 inches from the heat until the cheese melts and some meatballs are lightly browned, about 5 minutes. Garnish with the basil leaves and serve with the salad.
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