Torpedoes were not limited to firing straight out of the tube; the result of the fire control calculations was a gryo angle. This gyro angle was the direction and amount the torpedo would turn before straightening out. During the launch, the torpedo's rudder would be put towards the side of the desired turn, and a system of gyroscopes would cancel the turn and straighten the rudder once the desired angle had been reached, and subsequently maintain that course.

A circular run occurred when this system failed in a way that prevented the torpedo from straightening out, such as the rudder mechanically jamming to the side or a gyroscope failure. It wasn't exactly a common problem, but it was a known danger, and every time a torpedo was launched, the hydrophone operators would try to track it to confirm that it was indeed going in the right direction.

Aside from the Tang, this also happened to the USS Tullibee. It's also probable that at least a few of the unexplained losses / disappearances of German and US submarines were a result of circle runners.