Microsoft Advertising has unveiled new localized deals through interactive online circulars (like those ads that fall out of your newspaper, the company notes) as part of MSN Local Edition.

The site is geo-targeted, so only location-relevant circulars will be shown to consumers.

Site visitors will be able to rotate through the different circulars on one screen, as well as browse and flip through them just like print versions. They will also be able to search for products across circulars, add items to a shopping list, find retailer locations with Bing Maps, and share offers with friends through Facebook, Twitter, and Windows Live.

The back-end data for the circulars comes from ShopLocal. As long as retailers update their info on ShopLocal, their circulars will be refreshed. If they’re not current, they won’t be shown.

Microsoft says it intends to leverage more of its assets (including mobile) as it evolves its circular offerings. Advertisers need to talk to their account execs if they want to take advantage of this kind of offering.