The problem of wave diffraction by a circular crack in an ice sheet floating on water of finite depth is considered. The fluid flow is described by the linear velocity potential theory, while the infinitely extended ice sheet is modeled as a thin elastic plate with uniform properties. At the crack, zero bending moment and shear force conditions are enforced. The solution starts from the Green function for ice sheet without the crack. This is then used to obtain an integral equation, in which the jumps of the displacement and slope across the crack are the unknowns. For a circular crack, the unknowns are expanded into the Fourier series in the circumferential direction. Through imposing the boundary conditions at the crack, a matrix equation is obtained for the unknowns, which is then truncated and solved. Convergence study is undertaken with respect to the truncation, and it has been found that the series converges fast. A far field identity is used to verify the solution procedure and is found to be satisfied very accurately. Extensive results are provided, and their physical implications are discussed. These include the jumps of the displacement and slope across the crack, resonant motion, far field diffracted wave amplitude, and the deflection of the ice sheet
