Started as a nonprofit theater company in Greenwich Village, the Circle in the Square moved to its current home in 1972, when the theater was built.

The theater was designed by Allen Sayles with a thrust stage and a U-shaped seating arrangement in which no audience member was more than eight rows from the stage, thus retaining the intimate feel that the company had in its downtown location. However, the new theater was much more technically sophisticated and included a unique lighting plan created by noted designer Jules Fisher. Originally founded in 1951 by a group of actors led by Theodore Mann and Jose Quintero, in 1963, Paul Libin joined forces with Mann to run the company, which eventually became a for-profit venture in 1998. The new Circle in the Square Theatre opened on November 15, 1972, with Mourning Becomes Electra, featuring Colleen Dewhurst. Mike Nichols directed George C. Scott, Lillian Gish, and Julie Christie in Uncle Vanya, and Nathan Lane made his Broadway debut there in Present Laughter. Recent productions include True West and The 25th Annual Putnam County Spelling Bee.