How to Crop an Image into a Circle in Photoshop
Photoshop doesn’t export true circular files, but you can simulate a circle by framing the image and exporting with transparency. You’ll use the Frame Tool to create an elliptical frame, position your subject, and export as a PNG with transparent corners.

Step-by-step instructions
Set up the circular frame
Press K to activate the Frame Tool.
In the Options bar, choose the circular (ellipse) frame.
If creating a frame makes a new layer, unlock your photo layer by clicking the lock icon and try again.
Draw and position the circle
Drag on the image to create the circular frame over your subject.
To move the image inside the frame, double-click until the image (not the frame) is active, then drag to reposition.
If the frame is active, use its corner handles to resize the circle.
Refine the composition
Toggle between selecting the image and the frame by clicking on them in the Layers panel or double-clicking on canvas.
Re-center the subject as needed by dragging the image inside the frame.
Remember: the frame acts like a Smart Object, so adjustments are editable.
Export with transparency
Right-click the frame layer → Quick Export as PNG, or go to File → Export → Export As.
In Export As, set Format → PNG and enable Transparency.
Click Export to save your circular-cropped image (transparent corners create the circle effect).