The composition of Earth's atmosphere depends on the redox state of the mantle, which became more oxidizing at some stage after Earth's core started to form. Through high-pressure experiments, we found that Fe2+ in a deep magma ocean would disproportionate to Fe3+ plus metallic iron at high pressures. The separation of this metallic iron to the core raised the oxidation state of the upper mantle, changing the chemistry of degassing volatiles that formed the atmosphere to more oxidized species. Additionally, the resulting gradient in redox state of the magma ocean allowed dissolved CO2 from the atmosphere to precipitate as diamond at depth. This explains Earth's carbon-rich interior and suggests that redox evolution during accretion was an important variable in determining the composition of the terrestrial atmosphere.