Circular RNAs (circRNAs) have recently been suggested as potential functional modulators of cellular physiology processes in gastric cancer (GC). In this study, we demonstrated that circFOXP1 was more highly expressed in GC tissues. High circFOXP1 expression was positively associated with tumor size, lymph node metastasis, TNM stage, and poor prognosis in patients with GC. Cox multivariate analysis revealed that higher circFOXP1 expression was an independent risk factor for disease-free survival (DFS) and overall survival (OS) in GC patients. Functional studies showed that increased circFOXP1 expression promoted cell proliferation, cell invasion, and cell cycle progression in GC in vitro. In vivo, the knockdown of circFOXP1 inhibited tumor growth. Mechanistically, we observed ALKBH5-mediated m6A modification of circFOXP1 and circFOXP1 promoted GC progression by regulating SOX4 expression and sponging miR-338-3p in GC cells. Thus, our findings highlight that circFOXP1 could serve as a novel diagnostic and prognostic biomarker and potential therapeutic target for GC.