Objective Circular‐mitochondrial translation optimization 1 (circ‐MTO1) inhibits the progression of gastric cancer by regulating the growth, apoptosis, and invasion of tumor cells. However, its clinical potential as a biomarker for gastric cancer remains to be further evaluated. This study aimed to assess circ‐MTO1 expression and its correlation with clinical features and prognosis in gastric cancer patients, as well as the effect of circ‐MTO1 on the sensitivity to chemotherapy in gastric cancer cells. Methods Circ‐MTO1 in tumor and adjacent tissues of 97 gastric cancer patients undergoing resection was examined by reverse transcription‐quantitative polymerase chain reaction. HGC‐27 and NCI‐N87 cells transfected by circ‐MOT1 overexpression plasmid (OE‐circ‐MOT1) and negative control (OE‐NC) were treated with 0‒6.4 μM oxaliplatin. Relative cell viability was detected using Cell Counting Kit‐8. Results Circ‐MTO1 was insufficiently expressed in gastric tumor tissue (median (interquartile range): 0.403 (0.288‒0.518)) compared with adjacent tissue (median (interquartile range): 1.000 (0.715‒1.524)) ( p < 0.001). Besides, tumor circ‐MTO1 was correlated with less lymph node metastasis ( p = 0.014) and low TNM stage ( p = 0.039), while was not correlated with demographic features or other clinical characteristics (all p > 0.05). Furthermore, tumor circ‐MTO1 high expression was independently correlated with prolonged disease‐free survival (DFS) ( p = 0.013, adjusted hazard ratio (95% confidential interval): 0.314 (0.126‒0.782)), but was not correlated with overall survival ( p > 0.05). Lastly, in gastric cancer cells, OE‐circ‐MTO1 apparently decreased relative cell viabilities at oxaliplatin concentrations of 0.4, 0.8, 1.6, and 3.2 μM (all p < 0.05). Conclusion Circ‐MTO1 correlates with less lymph node metastasis, prolonged DFS, and improved chemotherapy sensitivity in gastric cancer.