Mask ImageView with round corner background

The best way is to do it in Canvas using PorterDuff operations and/or Shaders. Let's say your Bitmap is available and stored in mBitmap.

Option 1: Using Shaders.

@Override
public void onDraw(Canvas canvas) {
    super.onDraw(canvas);

    // Load the bitmap as a shader to the paint.
    final Paint paint = new Paint(Paint.ANTI_ALIAS_FLAG);
    final Shader shader = new BitmapShader(mBitmap, Shader.TileMode.CLAMP, Shader.TileMode.CLAMP);
    paint.setShader(shader);

    // Draw a circle with the required radius.
    final float halfWidth = canvas.getWidth()/2;
    final float halfHeight = canvas.getHeight()/2;
    final float radius = Math.max(halfWidth, halfHeight);
    canvas.drawCircle(halfWidth, halfHeight, radius, paint);
}

Option 2: Using PorterDuff mode.

@Override
public void onDraw(Canvas canvas) {
    super.onDraw(canvas);

    // Create a circular path.
    final float halfWidth = canvas.getWidth()/2;
    final float halfHeight = canvas.getHeight()/2;
    final float radius = Math.max(halfWidth, halfHeight);
    final Path path = new Path();
    path.addCircle(halfWidth, halfHeight, radius, Path.Direction.CCW);

    final Paint paint = new Paint(Paint.ANTI_ALIAS_FLAG);
    paint.setXfermode(new PorterDuffXfermode(PorterDuff.Mode.DST_IN));
    canvas.drawPath(path, paint);
}

Note:

1. It's not good to create objects inside onDraw() calls. Hence you should have your paint and shader initially somewhere else. This could probably be done when you set the image bitmap to the view.
2. Canvas might need to be saved and restored when it is not backed by a hardware texture. The general ideas around it are not mentioned here.
3. Remember to add setWillNotDraw(false); to the constructor.

Additional References:

1. https://sriramramani.wordpress.com/2012/12/21/shaders/ has information on Shaders.
2. http://mxr.mozilla.org/mozilla-central/source/mobile/android/base/ShapedButton.java uses Path to curved button in Firefox for Android.
3. http://sriramramani.wordpress.com/2012/08/27/constructing-squishy-buttons/ has information on Canvas saving, restoring and special cases for pre-ICS.

I'd definite recommend Picasso, as others have. This bit of code for one of my Activity classes did the trick for me. It utilized a color I had defined in color.xml and a simple layout (shown below).

       ImageView profile_image = (ImageView) findViewById(R.id.profile_image);
       mContext = profile_image.getContext();

        // ----------------------------------------------------------------
        // apply rounding to image
        // see: https://github.com/vinc3m1/RoundedImageView
        // ----------------------------------------------------------------
        Transformation transformation = new RoundedTransformationBuilder()
                .borderColor(getResources().getColor(R.color.my_special_orange))
                .borderWidthDp(5)
                .cornerRadiusDp(50)
                .oval(false)
                .build();

        Picasso.with(mContext)
                .load("http://{some_url}.jpg")
                .fit()
                .transform(transformation)
                .into(profile_image);

And the corresponding Layout file:

    <LinearLayout
        android:orientation="horizontal"
        android:layout_width="fill_parent"
        android:layout_height="120dp"
        android:layout_alignParentTop="true"
        android:layout_alignParentStart="true"
        android:padding="12dp">


        <ImageView
            android:id="@+id/profile_image"
            android:layout_width="80dp"
            android:layout_height="80dp"
            android:layout_gravity="center"/>

        <LinearLayout
            android:orientation="vertical"
            android:layout_width="match_parent"
            android:layout_height="80dp"
            android:layout_gravity="center"
            android:padding="12dp">


            <TextView
                android:layout_width="match_parent"
                android:layout_height="wrap_content"
                android:textAppearance="?android:attr/textAppearanceLarge"
                android:text="First-Name"
                android:id="@+id/profile_first_name"
                />

            <TextView
                android:layout_width="match_parent"
                android:layout_height="wrap_content"
                android:textAppearance="?android:attr/textAppearanceSmall"
                android:text="Lastname"
                android:id="@+id/profile_last_name" />
        </LinearLayout>



        </LinearLayout>
</RelativeLayout>

Here's the result: