The system power loss and bridge arm current distortion of a modular multilevel converter (MMC) are increased by the circulating current. In view of the poor robustness and limited control accuracy of the traditional PI circulating current controller, the fractional order PIλ controller is applied to MMC circulating current suppressing. First, the working characteristics of MMC are analyzed, and the mechanism of circulating current generation is described. Second, the fractional order PIλ control structure is studied and the fractional order PIλ circulating current suppressing strategy is designed. Then, the classical frequency domain method is used to optimize the fractional order PIλ controller parameters, and the circulating current control performance of the system using traditional PI controller and fractional order PIλ controller is analyzed. Finally, under the same conditions, the system with fractional order PIλ circulating current suppressing strategy and traditional PI circulating current suppressing strategy are simulated under AC power disturbance, DC-side voltage step and three-phase unbalance conditions respectively. The results show that the designed fractional order PIλ circulating current controller outperforms the traditional PI circulating current controller in anti-power disturbance and circulating current suppressing, and is more suitable for nonlinear systems such as MMC. This work is supported by the National Natural Science Foundation of China (No. 61703144).