Before 1776 and the adoption of an official flag for the newly-formed United States, the Continental forces used what they called the Grand Union flag. It featured the familiar red and white stripes, but had a British Union Jack in the canton and could be misinterpreted as denoting loyalty to Britain.
The section in the upper right corner of a flag (from the flag’s point of view) is called the canton or the union.
Betsy Ross, a Philadelphia upholsterer and seamstress, was an acquaintance of George Washington. They attended the same church and had adjoining pews. In May 1776 Washington and two other revolutionary leaders called on her and asked her to make a flag. The stars in their suggested design had six points, like a Star of David.
Mrs. Ross showed them she could cut a five-pointed star in a single snip. She finished the flag in late May or early June.
When the resolution adopting a national flag was passed on June 14, 1777, the arrangement of the stars was not specified:
“Resolved: that the flag of the United States be thirteen stripes, alternate red and white; that the union be thirteen stars, white in a blue field, representing a new constellation.”
As a result, the 13 stars on early flags are not always placed in a circle.