This study aims to identify the barriers to implementing Smart Circular Industry in the steel sector. A mixed-methods research design, combining qualitative and quantitative approaches, employed. In the qualitative phase, thematic analysis used to identify the barriers, while in the quantitative phase, the relationships among these barriers examined using fuzzy cognitive mapping. The study population consisted of experts from the steel industry. Data collected through semi-structured interviews in the qualitative phase and questionnaires in the quantitative phase. The interview process continued until theoretical saturation achieved, which occurred after conducting 15 interviews. The qualitative findings revealed that the implementation of smart circular industry in the steel sector faces a wide range of challenges. Following the analysis and coding of interview data, 87 basic themes identified. Through a process of aggregation and refinement, these themes categorized into 17 organizing themes and 5 global themes. The results of the quantitative phase and the fuzzy cognitive mapping analysis classified these challenges into three categories based on their relative importance and systemic role: driving factors, dependent factors, and ordinary factors. An examination of the influence and dependence indices indicated that five barriers; namely, "competitive and market pressures", "international restrictions and sanctions", "managerial attitudes and motivation", "policy and institutional support deficiencies", and "technological dependence and limited access to advanced technologies"; belong to the group of driving factors and can therefore be considered the primary drivers of the system. Finally, several recommendations proposed to address these barriers and facilitate the transition toward a smart circular industry in the steel sector.