Magic Circle Music was founded by Manowar bassist Joey DeMaio in 2005 named after Richard Wagner's Der Ring des Nibelungen. The purpose of the label is to give the band (Manowar) creative control. Furthermore, it is stated on their website that they (Manowar) saw many other bands "fall to the perils of greed and commercialization in the music industry". To put an end to this practice, DeMaio founded Magic Circle Music through which he felt he could help other developing artists avoid these traps.
In late 2007, DeMaio became involved in a legal battle with Rhapsody of Fire. The release of any of the band's new material was suspended until November 18, 2009 when they signed with Nuclear Blast and announced they would have released a new album in April 2010.
Apart from releasing band merchandise, the label is also responsible for organizing the Magic Circle Festival, which first took place in 2007 in Bad Arolsen, Germany.