Abstract In order to theoretically understand dust properties in the circumgalactic medium (CGM), we construct a dust evolution model that incorporates the evolution of grain size distribution. We treat the galaxy and the CGM as separate one-zone objects, and consider the mass exchange between them. We take into account dust production and interstellar dust processing for the galaxy based on our previous models, and newly incorporate sputtering in the hot phase and shattering in the cool phase for the CGM. We find that shattering increases the dust destruction (sputtering) efficiency in the CGM. The functional shape of the grain size distribution in the CGM evolves following that in the galaxy, but it is sensitive to the balance between sputtering and shattering in the CGM. For an observational test, we discuss the wavelength dependence of the reddening in the CGM traced by background quasar colors, arguing that, in order to explain the observed reddening level, a rapid inflow from the CGM to the galaxy is favored because of quick dust/metal enrichment. Small grain production by shattering in the CGM also helps to explain the rise of dust extinction toward short wavelengths.