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Information in this article is non-canon

The Fire Circle is actually the dino name for a total lunar eclipse.   It should not be confused with the Bright Circle, which is the dino name for the Sun.  Rather, it is a Blood Moon, or red Night Circle, as the dinos would call it.

The Old One tells Ali, who is her great-great niece, and Littlefoot that has seen it twice so far and it is clear that she views it as a sort of death omen.   Indeed, in the end, it is her death omen the last time it appears in Land Before Time.  

The first time it appears was when the Old One's herd first invaded the Great Valley 90 years before Littlefoot and Ali were born.  Then, the Great Valley was inhabited by Sharpteeth, in particular, Tyrannosaurus Rex.   The Old One, whos name is revealed at last as Clarice, was with her friend and lover, Viktor, staying, as they falsely believed, as safe distance away from the night attack.  At first, the Sharpteeth died in the sleep, murdered by the herbivores.  However, then the Night Cirlce suddenly turned blood red and, as it did so, Clarice saw the red eys of the Sharpteeth as they awoke and came for an attack.   Her lover Viktor was grabbed by the Sharpteeth and eaten, which the Old One told Ali and Littlefoot in her later years that she could not bear to watch.  Clarice was able to get away herself by hiding in a crevice.  Eventually the Sharpteeth were driven from the Great Valley, but at a terrible price, including the lives of both of Clarice's parents.  

Decades later, the Fire Circle is seen during one particular bad night in between clouds in a thunderstorm in her new home, which is now becoming the Land of Mists.  That fateful night, Belly Draggers, among others, maul many in Clarice's herd, which she now controls.  She had Ali sheltered from the carnage.  

The final time the Fire Circle appeared was when Ali was of age, though just barely, and it was near Littlefoot's 25th Star Day when he would come of age.  That night, Andromeda, a resident of the Valley of Sharpteeth came into the Great Valley via its secret entrance.  ChomperCeraDuckyPetrieSpike, Littlefoot, Ali, and, unknown to them, Gallim, were the only ones who knew that Andromeda was coming.

Gallim, who hoped that he could cause a fight that would get Chomper and Andromeda killed or kicked out of the Great Valley, figuring Chomper would come to Andromeda's rescue, and fearing they, who were so close to figuring it out, would expose him as the Terror of the Mysterious Beyond and foil his plot to take over the dinosaur world, woke up the Old One.  He told her that a resident of the Valley of Sharpteeth was in the Great Valley.  Seeing the Fire Cirlce, the Old One, fearing that someone else she cared about would die, ran to go where Gallim led her.  

She found Andromeda and soon found from Andromeda that she was indeed from the Valley of Sharpteeth.  Not believing that Andromeda could be nice, the Old One starts attacking her.  As Andromeda is overpowered, Chonmper comes.  He tries to get the Old One to back off.  The Old One refuses.  Chomper comes at her, and she threatens to harm him too, so filled with a lust for revenge that she cannot think over what she is doing.   

Chomper and the Old One get in a tussle.  Finally, Chomper actually stabs the Old One with his claws, cutting her open.  Chomper and Andromeda are forced to flee.  Clarice soon dies from her injuries, making this Fire Circle an omen of her own death this time.   The Fire Circle is last seen at the Clarice's funeral.  

The final appearance of the Fire Cirlce is considered to be one of the Land Before Time franchise's darkest.  

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