A circular definition occurs when a term is defined using the term itself or a variation of it, making the definition unhelpful. For example, defining "happiness" as "the state of being happy" does not provide any new information about what happiness actually means. These definitions can lead to confusion and misunderstandings, as they do not clarify the concept being defined. Instead of enhancing understanding, circular definitions often leave individuals with the same questions they had before, highlighting the importance of clear and precise language in definitions.