A very high spatial resolution (∼25 m pixel at 90 km altitude) OH airglow imager was installed at the Andes Lidar Observatory on Cerro Pachón, Chile, in February 2016. This instrument was collocated with a Na wind-temperature lidar. On 1 March 2016, the lidar data showed that the atmosphere was dynamically unstable before 0100 UT and thus conducive to the formation of Kelvin-Helmholtz instabilities (KHIs). The imager revealed the presence of a KHI and an apparent atmospheric gravity wave (AGW) propagating approximately perpendicular to the plane of primary KHI motions. The AGW appears to have induced modulations of the shear layer leading to misalignments of the emerging KHI billows. These enabled strong KHI billow interactions, as they achieved large amplitudes and a rapid transition to turbulence thereafter. The interactions manifested themselves as vortex tube and knot features that were earlier identified in laboratory studies, as discussed in Thorpe (1987, https://doi.org/10.1029/ JC092iC05p05231; 2002, https://doi.org/10.1002/qj.200212858307) and inferred to be widespread in the atmosphere based on features seen in tropospheric clouds but which have never been identified in previous upper atmospheric observations. This study presents the first high-resolution airglow imaging observation of these KHI interaction dynamics that drive rapid transitions to turbulence and suggest the potential importance of these dynamics in the mesosphere and at other altitudes. A companion paper (Fritts et al., 2020, https://doi.org/10.1029/2020JD033412) modeling these dynamics confirms that the vortex tubes and knots yield more rapid and significantly enhanced turbulence relative to the internal instabilities of individual KHI billows.