The measurement sensitivity of quantum probes using N uncorrelated particles is restricted by the standard quantum limit1, which is proportional to [Formula: see text]. This limit, however, can be overcome by exploiting quantum entangled states, such as spin-squeezed states2. Here we report the measurement-based generation of a quantum state that exceeds the standard quantum limit for probing the collective spin of 1011 rubidium atoms contained in a macroscopic vapour cell. The state is prepared and verified by sequences of stroboscopic quantum non-demolition (QND) measurements. We then apply the theory of past quantum states3,4 to obtain spin state information from the outcomes of both earlier and later QND measurements. Rather than establishing a physically squeezed state in the laboratory, the past quantum state represents the combined system information from these prediction and retrodiction measurements. This information is equivalent to a noise reduction of 5.6 decibels and a metrologically relevant squeezing of 4.5 decibels relative to the coherent spin state. The past quantum state yields tighter constraints on the spin component than those obtained by conventional QND measurements. Our measurement uses 1,000 times more atoms than previous squeezing experiments5-10, with a corresponding angular variance of the squeezed collective spin of 4.6 × 10-13 radians squared. Although this work is rooted in the foundational theory of quantum measurements, it may find practical use in quantum metrology and quantum parameter estimation, as we demonstrate by applying our protocol to quantum enhanced atomic magnetometry.