Altermagnetism is a recently identified magnetic symmetry class combining characteristics of conventional collinear ferromagnets and antiferromagnets, that were regarded as mutually exclusive, and enabling phenomena and functionalities unparalleled in either of the two traditional elementary magnetic classes. In this work we use symmetry and ab initio theory to explore X-ray magnetic circular dichroism (XMCD) in the altermagnetic class. Our results highlight the distinct phenomenology in altermagnets of this time-reversal symmetry breaking response, and its potential utility for element-specific spectroscopy and microscopy in altermagnets. As a representative material for our XMCD study we choose $\alpha$-MnTe with the compensated antiparallel magnetic order in which an anomalous Hall effect has been already demonstrated both in theory and experiment. The predicted magnitude of XMCD lies well within the resolution of existing experimental techniques.