The spatial organization of chromosomes influences many nuclear processes 
including gene expression. The cohesin complex shapes the 3D genome by looping 
together CTCF sites along chromosomes. We show here that chromatin loop size can 
be increased and that the duration with which cohesin embraces DNA determines 
the degree to which loops are enlarged. Cohesin's DNA release factor WAPL 
restricts this loop extension and also prevents looping between incorrectly 
oriented CTCF sites. We reveal that the SCC2/SCC4 complex promotes the extension 
of chromatin loops and the formation of topologically associated domains (TADs). 
Our data support the model that cohesin structures chromosomes through the 
processive enlargement of loops and that TADs reflect polyclonal collections of 
loops in the making. Finally, we find that whereas cohesin promotes chromosomal 
looping, it rather limits nuclear compartmentalization. We conclude that the 
balanced activity of SCC2/SCC4 and WAPL enables cohesin to correctly structure 
chromosomes.