Condensin I and topoisomerase II (topo II) are chromosomal ATPases essential for mitotic chromosome assembly. Mechanistically how the two ATPases cooperate to assemble mitotic chromosomes remains unknown. Here we use total internal reflection fluorescence microscopy to analyze the interplay between condensin I and topo II at single-molecule resolution. As observed in previous studies, condensin I alone predominantly forms DNA loops in an ATP-dependent manner. However, when topo II is included in the reaction, condensin I forms stable compact structures (termed lumps) in a manner dependent on the C-terminal domain of topo II. Each of the stable lumps contains a single condensin I complex and a single topo II dimer. Remarkably, we find that topo II when catalytically active, renders the lumps resistant to protease treatment. Several lines of evidence show that the protease-resistant lumps contain knotted DNA. A mutant condensin I complex defective in ATP hydrolysis, together with topo II, forms smaller lumps in which the probability of DNA knotting is greatly reduced. Our results demonstrate how topo II-mediated strand passage is coupled with condensin I-mediated loop extrusion to generate a compact DNA structure. Together with recent studies, we discuss the functional implications of these observations in mitotic chromosome assembly and stabilization.