Chromosomal instability is a key step in the generation of the cancer cell karyotype. An indicator of unstable chromosomes is the presence of chromatin bridges during anaphase. We examined in detail the fate of anaphase bridges in cultured oral squamous cell carcinoma cells in real-time. Surprisingly, chromosomes in bridges typically resolve by breaking into multiple fragments. Often these fragments give rise to micronuclei (MN) at the end of mitosis. The formation of MN is shown to have important consequences for the cell. We found that MN have incomplete nuclear pore complex (NPC) formation and nuclear import defects and the chromatin within has greatly reduced transcriptional activity. Thus, a major consequence of the presence of anaphase bridges is the regular sequestration of chromatin into genetically inert MN. This represents another source of ongoing genetic instability in cancer cells.