A Photoshop canvas is always going to be rectangular. Within that space, you can create your circular artwork and use either a clipping path or transparency to place it as a circle.
Are you referring to a joint project for a team if developer in your circle, Or are you a new Photoshop user the want to drat a circle? If you a new user use the ellipse tool hole the shift key down to constrain the ellipse to a circle. Photoshop has a huge learning curve. Look for beginner tutorials on the web or a web Photoshop training course. Many perhaps most thing in Photoshop are not intuitive they are learned.
I usually begin my projects with a transparent workspace denoted by the checkerboard patterned background. And then I draw a circular shape with the Ellipse Tool inside my workspace. Everything outside my circle will be transparent when I save my image. See screenshot of a Twitter icon saved for web as transparent PNG.
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