It is well known that fibroblast growth factor receptor 2 (FGFR2) interacts with its ligand of fibroblast growth factor (FGF) therefore exerting biological functions on cell proliferation and differentiation. In this study, we first reported that the FGFR2 gene could generate a circular RNA of circFGFR2, which regulates skeletal muscle development by sponging miRNA. In our previous study of circular RNA sequencing, we found that circFGFR2, generated by exon 3–6 of FGFR2 gene, differentially expressed during chicken embryo skeletal muscle development. The purpose of this study was to reveal the real mechanism of how circFGFR2 affects skeletal muscle development in chicken. In this study, cell proliferation was analyzed by both flow cytometry analysis of the cell cycle and 5-ethynyl-2′-deoxyuridine (EdU) assays. Cell differentiation was determined by analysis of the expression of the differentiation marker gene and Myosin heavy chain (MyHC) immunofluorescence. The results of flow cytometry analysis of the cell cycle and EdU assays showed that, overexpression of circFGFR2 accelerated the proliferation of myoblast and QM-7 cells, whereas knockdown of circFGFR2 with siRNA reduced the proliferation of both cells. Meanwhile, overexpression of circFGFR2 accelerated the expression of myogenic differentiation 1 (MYOD), myogenin (MYOG) and the formation of myotubes, and knockdown of circFGFR2 showed contrary effects in myoblasts. Results of luciferase reporter assay and biotin-coupled miRNA pull down assay further showed that circFGFR2 could directly target two binding sites of miR-133a-5p and one binding site of miR-29b-1-5p, and further inhibited the expression and activity of these two miRNAs. In addition, we demonstrated that both miR-133a-5p and miR-29b-1-5p inhibited myoblast proliferation and differentiation, while circFGFR2 could eliminate the inhibition effects of the two miRNAs as indicated by rescue experiments. Altogether, our data revealed that a novel circular RNA of circFGFR2 could promote skeletal muscle proliferation and differentiation by sponging miR-133a-5p and miR-29b-1-5p.