What does it mean when mushrooms are in a circle?

A fairy ring, also known as fairy circle, elf circle, elf ring or pixie ring, is a naturally occurring ring or arc of mushrooms. The rings may grow to over 10 metres (33 ft) in diameter, and they become stable over time as the fungus grows and seeks food underground.

Furthermore, why does fungus grow in a circle?

In grass, the best known fairy ring fungus has the scientific name Marasmius oreades. The body of this fungus, its mycelium, is underground. It grows outward in a circle. As it grows, the mycelium uses up all of the nutrients in the soil, starving the grass.