Underlining the Need of Circular Economy in Urban Environment It is no secret that global environmental issues are in the agenda of governmental bodies and scientific community as well as society which is feeling the impacts of these environmental challenges. Majority of people around the globe are subjects of urban environment and the percentage of city inhabitants is expected to grow in the following decades. Therefore, it is crucial to address environmental issues in city level. A promising concept which is gaining more and more attention among scientists and governmental bodies is the circular economy as it holds the potential to tackle resource depletion and climate change. Current research is aimed at identifying circular economy strategies and approaches to implement circular economy in urban environment. Methodology includes the analysis of recent literature and statistical data. Results outline that even though cities are the main drivers of carbon emissions, they are also centres of innovation and economic growth. They are uniquely positioned to support approaches of circular economy by implementing R strategies – refuse, rethink, redesign, reduce, reuse, repair, refurbish, remanufacture, repurpose, recycle, recover – and adapt these approaches from product to industry levels. It is concluded that to unlock the potential of circular economy in urban environment, governance bodies of cities need to create a shared circular economy vision with measurable targets and inclusive strategies; establish supportive financial and regulatory instruments; empower collaboration across sectors, stakeholders and governance levels; and enforce assessment mechanisms to help cities learn from experience and scale up circular economy practices.