We engineered mutants into residues of SMC2 to dissect the role of ATPase function in the condensin complex. These residues are predicted to be involved in ATP binding or hydrolysis and in the Q-loop, which is thought to act as a mediator of conformational changes induced by substrate binding. All the engineered ATPase mutations resulted in lethality when introduced into SMC2 null cells. We found that ATP binding, but not hydrolysis, is essential to allow stable condensin association with chromosomes. How SMC proteins bind and interact with DNA is still a major question. Cohesin may form a ring structure that topologically encircles DNA. We examined whether condensin behaves in an analogous way to its cohesin counterpart, and we have generated a cleavable form of biologically active condensin with PreScission protease sites engineered into the SMC2 protein. This has allowed us to demonstrate that topological integrity of the SMC2-SMC4 heterodimer is not necessary for the stability of the condensin complex in vitro or for its stable association with mitotic chromosomes. Thus, despite their similar molecular organization, condensin and cohesin exhibit fundamental differences in their structure and function.