The concept of circular economy (CE) is high on the agenda of many planning agencies in European countries. It has also become a prominent issue in European academic education institutions. It is expected that spatial planning and design can support and add the spatial quality dimension of such a transition towards CE. However, incorporating the concept of CE in an integrative manner in urban design and planning courses is challenging because of its metabolic and complex nature. This article presents the first results of integrating design-teaching activities at a faculty of architecture with an H2020-financed research project. The integration of research and design education provided the students with a situated and indeed transdisciplinary learning environment. Students understood that they needed to address challenges from a systemic perspective rather early in the design process, meaning to understand what the relations between different subsystems and their spatial structures are. Furthermore, the experiment provided evidence that the eco-innovative solutions developed by the students are seen as an effective option to achieve objectives for a transition towards CE by stakeholders.