A circumpolar star is a star, as viewed from a given latitude on Earth, that never sets below the horizon due to its apparent proximity to one of the celestial poles. Circumpolar stars are therefore visible from said location toward the nearest pole for the entire night on every night of the year (and would be continuously visible throughout the day too, were they not overwhelmed by the Sun's glare).
All circumpolar stars lie within a relative circumpolar circle, whose radius equals the observer's latitude. This was in fact the original meaning of "Arctic Circle", before the current geographical meaning, meaning "Circle of the Bears" (Ursa Major, the Great Bear; and Ursa Minor, the Little Bear), from Greek αρκτικός (arktikos), "near the Bear", from the word άρκτος (arktos) bear.
As Earth rotate daily on its axis, the stars appear to move in circular paths around one of the celestial poles (the north celestial pole for observers in the Northern Hemisphere, or the south celestial pole for observers in the Southern Hemisphere). Stars far from a celestial pole appear to rotate in large circles; stars located very close to a celestial pole rotate in small circles and hence hardly seem to engage in any diurnal motion at all. Depending on the observer's latitude on Earth, some stars – the circumpolar ones – are close enough to the celestial pole to remain continuously above the horizon, while other stars dip below the horizon for some portion of their daily circular path (and others remain permanently below the horizon).
The circumpolar stars appear to lie within a circle that is centered at the celestial pole and tangential to the horizon. At the Earth's North Pole, the north celestial pole is directly overhead, and all stars that are visible at all (that is, all stars in the Northern Celestial Hemisphere) are circumpolar. As one travels south, the north celestial pole moves towards the northern horizon. More and more stars that are at a distance from it begin to disappear below the horizon for some portion of their daily "orbit", and the circle containing the remaining circumpolar stars becomes increasingly small. At the Equator, this circle vanishes to a single point – the celestial pole itself – which lies on the horizon, and there are thus effectively no circumpolar stars at all.