PKO stands for Progressive Knockout Tournament, which is basically a bounty tournament on steroids.
In regular bounty tournaments, each player has a bounty on their head. Knock out that player and you get 100% of that bounty. But in PKO’s, you get 50% of the bounty of the player you knock out and the other 50% goes on your head. That means as more players get knocked out, the bounties on the remaining players have the potential to grow to huge amounts.
If you want to play in a Progressive Knockout Tournament, just look for PKO in the tourney description. You can also look for the bulls-eye symbol to find it quickly.