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Vestibular disease, which becomes more common as a dog ages, causes a dog to walk in circles. Parasites, systemic lupus erythematosus, encephalitis, canine distemper and fluctuating blood sugar levels may cause a dog to walk in circles. Brain tumors, also called meningioma, can cause a dog to walk in circles.
In fact, if you notice that your dog has begun to walk in circles regularly, this may even be a sign that there is something wrong with his health. Because this could be a potentially serious condition, it's a good idea to keep an eye out for other symptoms which may exist along with this odd behavior.