When you're working in the round there are two main ways that you can start out. Sometimes a pattern will tell you to chain a number and join, then you'll work your next round into that space the chains made. That almost always leaves a small gap in the middle. Now, that's fine and preferable in some instances, actually. However, there are times that you don't want that space to be there. The magic loop method takes care of that.
I call it magic loop, but I know that some people refer to it as magic circle or magic ring or adjustable ring. It doesn't matter what you prefer to call it, you will want to give it a try if you do any kind of crocheting in the round. You might find that, like me, you love this...especially if you make a lot of hats. :)