In living cells, DNA is highly confined in space with the help of condensing agents, DNA binding proteins and high levels of supercoiling. Due to challenges associated with experimentally studying DNA under confinement, little is known about the impact of spatial confinement on the local structure of the DNA. Here, we have used well characterized slits of different sizes to collect high resolution atomic force microscopy images of confined circular DNA with the aim of assessing the impact of the spatial confinement on global and local conformational properties of DNA. Our findings, supported by numerical simulations, indicate that confinement imposes a large mechanical stress on the DNA as evidenced by a pronounced anisotropy and tangent-tangent correlation function with respect to non-constrained DNA. For the strongest confinement we observed nanometer sized hairpins and interwound structures associated with the nicked sites in the DNA sequence. Based on these findings, we propose that spatial DNA confinement in vivo can promote the formation of localized defects at mechanically weak sites that could be co-opted for biological regulatory functions.