Previous circular RNA (circRNA) microarray analyses have uncovered an abnormal expression of hsa_circ_0070963 in hepatic stellate cells (HSCs). However, the specific role of hsa_circ_0070963 in liver fibrosis remains unknown. Here, we show that hsa_circ_0070963 inhibits liver fibrosis via regulation of miR-223-3p and LEMD3. Moreover, we demonstrated that hsa_circ_0070963 levels were reduced during liver fibrosis while restoring hsa_circ_0070963 levels abolished HSC activation, with a reduction in α-SMA and type I collagen levels both in vitro and in vivo. Furthermore, hsa_circ_0070963 overexpression suppressed both cell proliferation and the cell cycle of HSCs. MiR-223-3p was confirmed as a target of hsa_circ_0070963 and was shown to be involved in the effects of hsa_circ_0070963 on HSC activation. Furthermore, LEMD3 was confirmed as a target of miR-223-3p and was shown to be responsible for the activation of HSCs. The interactions between hsa_circ_0070963, miR-223-3p, and LEMD3 were validated via bioinformatic analysis, luciferase reporter assays, and rescue experiments. Collectively, hsa_circ_0070963 appeared to function as a miR-223-3p sponge that inhibited HSC activation in liver fibrosis via regulation of miR-223-3p and LEMD3. Therefore, hsa_circ_0070963 may serve as a potential therapeutic target for liver fibrosis.