Romans 4 begins Paul's look at the servant Abraham. In fact for Paul, Abraham was more than a servant, he was the earthly Father of Israel. We are reminded it is not by our actions we receive faith, rather it is the work of God by which we receive faith. To illustrate this Paul uses that ever popular topic of circumcision.
Circumcision was instituted of God for all the people would would followers of God prior to Jesus Christ. The permanent altering of the body was meant to show the permanent altering which took place in a persons heart. It was an outward and visible sign of the inner relationship a person had with God, much like the sacrament of Baptism in today's church. However, it was not the act of circumcision which makes a person righteous before God, just like baptism is not the tool by which we become righteous. It is through the altering of our heart, the way we live and interact with others, which shows our true connection.
Circumcision was a part of the law which the Jewish people followed with great devotion. The struggle is found in trying to live up to all the rules and regulations. Plain and simple, it is not possible to live out 100% of the law, 100% of the time. If we are depending on following the rules to provide our righteous standing with God, we are tragically doomed. It is through the grace of God, offered to us in Jesus Christ that brings about of righteous standing with God. Anything short of the God's grace through Jesus, will come up short.