Food systems are largely responsible for today’s anthropogenic environmental impacts. Transitioning towards a circular food system is seen as a promising solution to reduce land use (LU) and greenhouse gas emissions (GHGe). But what about biodiversity? The aim of this paper was to assess the potential of enhancing biodiversity in circular European food systems. Two scenarios were assessed with a food systems optimization model: land sharing or sparing while producing healthy food. Our results show that both scenarios can enhance biodiversity while reducing GHGe. The land sparing scenario reduced LU by 81%, depicting great potential for rewilding. However, reduction of LU was achieved via intensification, decreasing agroecosystem’s biodiversity (0 biodiversity score). Conversely, land sharing increased biodiversity in agroecosystems (86% biodiversity score), and LU was maintaned. Both scenarios require to radically redesign today’s food system. Our results demonstrate circular food systems can help enhance biodiversity via land sparing or sharing.