Objectives To understand how and why participation in quality circles (QCs) improves general practitioners' (GPs) psychological well-being and the quality of their clinical practice. To provide evidence-informed and practical guidance to maintain QCs at local and policy levels. Design A theory-driven mixed method. Setting Primary healthcare. Method We collected data in four stages to develop and refine the programme theory of QCs: (1) coinquiry with Swiss and European expert stakeholders to develop a preliminary programme theory; (2) realist review with systematic searches in MEDLINE, Embase, PsycINFO and CINHAL (1980-2020) to inform the preliminary programme theory; (3) programme refinement through interviews with participants, facilitators, tutors and managers of QCs and (4) consolidation of theory through interviews with QC experts across Europe and examining existing theories. Sources of data The coinquiry comprised 4 interviews and 3 focus groups with 50 European experts. From the literature search, we included 108 papers to develop the literature-based programme theory. In stage 3, we used data from 40 participants gathered in 6 interviews and 2 focus groups to refine the programme theory. In stage 4, five interviewees from different healthcare systems consolidated our programme theory. Result Requirements for successful QCs are governmental trust in GPs' abilities to deliver quality improvement, training, access to educational material and performance data, protected time and financial resources. Group dynamics strongly influence success; facilitators should ensure participants exchange knowledge and generate new concepts in a safe environment. Peer interaction promotes professional development and psychological well-being. With repetition, participants gain confidence to put their new concepts into practice. Conclusion With expert facilitation, clinical review and practice opportunities, QCs can improve the quality of standard practice, enhance professional development and increase psychological well-being in the context of adequate professional and administrative support. PROSPERO registration number CRD42013004826.