Pit craters are observed throughout the solar system, but are rarely seen forming. Here we document pit crater formation and characteristics following the 2011–2012 Cordón Caulle rhyolitic eruption using satellite and drone data with field observations. Syn-eruptive shallow intrusion (laccolith) uplift and subsequent subsidence at Cordón Caulle are found to be responsible for the creation of faults and fractures as well as at least 349 collapse pits. At Puyehue volcano, we measure nearly 35 m of subsidence within the 2.5 km wide summit caldera from 2016–2024 using digital elevation models leading to ring fractures and pit craters forming inside the caldera. Some pit craters may form from melting snow buried by tephra deposited during 2011–2012. This study offers a unique example of near real-time pit crater formation and evolution, which may be applied to better understanding these processes on Earth and other planetary bodies.