The synthesis of complex sugars is a key aspect of microbial biology. Cyclic β-1,2-glucan (CβG) is a circular polysaccharide critical for host interactions of many bacteria, including major pathogens of humans (Brucella) and plants (Agrobacterium). CβG is produced by the cyclic glucan synthase (Cgs), a multi-domain membrane protein. So far, its structure as well as the mechanism underlining the synthesis have not been clarified. Here we use cryo-electron microscopy (cryo-EM) and functional approaches to study Cgs from A. tumefaciens. We determine the structure of this complex protein machinery and clarify key aspects of CβG synthesis, revealing a distinct mechanism that uses a tyrosine-linked oligosaccharide intermediate in cycles of polymerization and processing of the glucan chain. Our research opens possibilities for combating pathogens that rely on polysaccharide virulence factors and may lead to synthetic biology approaches for producing complex cyclic sugars.