The negative impacts of the linear business model and the possibility of reusing waste in production are the primary drivers of strengthening the circular economy. The circular economy, as an economic philosophy based on the avoidance of waste and the creation of a circular flow of materials and resources in a closed circle, promotes awareness of the importance of preserving resources and the environment. Products in the circular economy are designed in such a way that they can be easily disassembled, recycled, and that waste can be used as a resource for new products or services. The recovery of nature from excessive and uncontrolled use is one of the principles of the circular economy. Companies using circular business models provide new solutions to drive higher revenues and reduce costs by transitioning to a circular economy. The transition from a linear economy model to a circular economy in Croatia is slow and inefficient. The lack of regulatory documents and circular economy development strategies makes it impossible to introduce a circular economy on a wider level. Compared to the European Union and neighboring countries in the European Union, such as Slovenia and Hungary, Croatia lags behind in all segments of waste management and circular economy. Obstacles in the transition to circular business models are found in the entire system, legislative frameworks, financial institutions, attitudes of citizens, lack of interest and technology on the part of companies, lack of adaptation of the infrastructure for collecting, sorting and recycling waste. The circular economy creates opportunities for economic growth, encourages new innovations and creates new jobs. Proposals for solutions and ideas for a more successful transition to a circular economy will help the Croatian economy to achieve better overall living conditions. The aim of the work itself is to investigate how circular the Croatian economy is in fact compared to certain countries from the surrounding area and the European Union itself, what are the barriers to the transition from a linear business model to a circular business model, to determine proposals for a better and more successful transition of the Croatian economy, and to present examples of good practice circular business in Croatia.