Circular RNAs (circRNAs) are closed long non-coding RNAs, in which the 5’ and 3’ termini are covalently linked by back-splicing of exons from a single pre-mRNA. Emerging evidence indicates that circRNAs are broadly expressed in mammalian cells and show cell type- or tissue-specific expression patterns. Importantly, circRNAs have been shown to participate in regulating various biological processes. Functionally, circRNAs can influence cellular physiology through various molecular mechanisms, such as serving as a decoy for microRNAs or RNA-binding proteins to modulate gene expression or translation of regulatory proteins. The biogenesis of circRNAs is known to be tightly regulated by cis- (intronic complementary sequences) and/or trans-factors (splicing factors) that constitute a cell- and context-dependent regulatory layer in the control of gene expression. However, our understanding of the regulation and function of circRNAs is still limited. In this review, we summarize the current progress in elucidating the functional roles, mechanisms and biogenesis of circRNAs. We also discuss the relationship between regulation and formation of circRNAs.