This study investigates the challenges hindering the integration of Circular Economy (CE) principles in prefabricated construction within South Africa and proposes strategies to enhance their implementation for sustainable development. A quantitative research approach was employed, using structured questionnaires administered to construction professionals including architects, engineers, quantity surveyors, and project managers. Data were analyzed descriptively, with the reliability of the instrument confirmed using Cronbach’s alpha. The results reveal that limited awareness and education on CE principles remain significant obstacles, preventing professionals from recognizing long-term benefits. A shortage of skilled labour, high initial costs, supply chain inefficiencies, and persistent quality concerns further restrict adoption. To overcome these barriers, respondents highlighted several key measures: targeted education and training programs, greater public awareness, financial support mechanisms, and investment in research and development. The findings contribute to academic discourse by contextualizing CE adoption within the South African construction sector and provide actionable insights for policymakers, practitioners, and educators seeking to advance sustainable construction practices.