"Misty Circles" was the first song to be released by Dead or Alive after being signed to a major label, Epic Records. The band's prior single releases were issued independently. This song was not very successful, but it managed to peak at number 100 on the UK Singles Chart. In 1984, the song was placed on the B-side of "You Spin Me Round (Like a Record)". As both sides earned significant play in American nightclubs, they charted together as a double-sided hit on the U.S. Hot Dance Club Play chart, peaking at number four. The band performed it before a live audience on Razzmatazz, which featured Burns in dreadlocks, wearing a Vivienne Westwood outfit and large hat similar to Boy George's then appearance, creating friction between the two performers for short period of time.
The single became the group's first entry on the UK Singles Chart in June 1983, as well as their lowest peaking single, charting to #100. Also gaining play in U.S. clubs, it reached #4 on the Hot Dance Club Play chart in 1983.