Elevated levels of extrachromosomal circular DNA (eccDNA or spcDNA) are closely associated with genomic instability and aging. Despite extensive studies, the mechanism of its generation in mammalian cells is unknown. We report here that mouse major satellite DNA (MSD) is prone to eccDNA formation and that the resulting molecules are multimeres of the basic repeat. Extrachromosomal circular major satellite (ECMS) DNA constitutes the majority of eccDNA in B16 mouse melanoma cells and is highly abundant in other mouse cells. Production of these molecules is enhanced in proliferating cells, suggesting that processes associated with DNA replication are involved in their appearance. Using siRNA technique we show that DNA Ligase IV is engaged in ECMS synthesis. Based on our findings we propose a novel two-step model for eccDNA formation in mammalian cells.