Hsp90 and Hsp70 are highly conserved molecular chaperones that promote the proper folding and activation of substrate proteins that are often referred to as clients. The two chaperones functionally collaborate to fold specific clients in an ATP-dependent manner. In eukaryotic cytosol, initial client folding is done by Hsp70 and its co-chaperones, followed by a direct transfer of client refolding intermediates to Hsp90 for final client processing. However, the mechanistic details of collaboration of organelle specific Hsp70 and Hsp90 are lacking. This work investigates the collaboration of the endoplasmic reticulum (ER) Hsp70 and Hsp90, BiP and Grp94 respectively, in protein remodeling using in vitro refolding assays. We show that under milder denaturation conditions, BiP collaborates with its co-chaperones to refold misfolded proteins in an ATP-dependent manner. Grp94 does not play a major role in this refolding reaction. However, under stronger denaturation conditions that favor aggregation, Grp94 works in an ATP-independent manner to bind and hold misfolded clients in a folding competent state for subsequent remodeling by the BiP system. We also show that the collaboration of Grp94 and BiP is not simply a reversal of the eukaryotic refolding mechanism since a direct interaction of Grp94 and BiP is not required for client transfer. Instead, ATP binding but not hydrolysis by Grp94 facilitates the release of the bound client, which is then picked up by the BiP system for subsequent refolding in a Grp94-independent manner.