space stations

That is the starbases area of effect.

When placing starbases (apart from mining ones)you will want to include things like planets or your trade routes etc etc according to the purpose of the starbase inside that blue circle. Constructors should have the blue circle as well to aid placement. In DL the blue circle for constructors is sometimes hard to see, but combining several constructors makes it more visible.

if it is a military star base can it attack anything in the circle?

Military bases cannot attack directly. The attack and defense bonus modules you add to them can help any armed vessel in their area of effect.

One use for this functionlity is to help create a strong "bluff fleet" of cheap, lightly armed hulls that become much tougher when you park them near a well-developed military base. I also occasionally build a military base at a "choke point" where the quickest paths between my production centers and enemy targets converge. It's not quite a front in ground war terms, but it is a little bit like one, so why not fortify it?

Hmmm, I've made plenty of Military bases that had the same basic attack/defense options as the other 2 starbases... unless my memory is WAY off...  

the other two bases have around 40 modules. the military has 60.

What I meant by "cannot attack directly" was that starbases can only defend themselves, no matter what kind they are. The attack and defense values only come into play when a ship or fleet attacks a base.

More specifically, they can't attack anywhere in the AoE as ible was asking. They will fight if attacked directly.

gotcha