Mohr's circle is a graphical representation used to analyze the state of stress at a point. It relates the normal and shear stresses acting on planes of all orientations passing through that point. The document discusses how to construct Mohr's circle through an example and how it can be used to analyze principal stresses, maximum shear stress, and normal and tangential stresses on any given plane. Applications of Mohr's circle include studying brittle deformation features like faults and fractures, pore pressure effects, and stability of structures like bridges, dams and tunnels.