
herumlaufen
to walk around
To move around on foot without a specific goal or clear intention.
Die Kinder liefen den ganzen Nachmittag fröhlich im Garten herum.
The children walked around happily in the garden all afternoon.
to walk around / go around
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to walk around
To move around on foot without a specific goal or clear intention.
Die Kinder liefen den ganzen Nachmittag fröhlich im Garten herum.
The children walked around happily in the garden all afternoon.

to go around
To be out and about in certain, often unusual or inappropriate, clothing.
Warum läufst du den ganzen Tag nur im Schlafanzug herum?
Why are you going around in pajamas all day?

to go around
To spread as a rumor or piece of news.
Es läuft das Gerücht herum, dass die Firma mehrere Mitarbeiter entlassen wird.
There's a rumor going around that the company is going to lay off several employees.
'Herumlaufen' (to walk around / go around) is a separable verb. The prefix 'herum-' comes at the end in a main clause, but stays attached to the verb in a subordinate clause.
Lauf nicht den ganzen Tag im Haus herum!
Don't walk around the house all day!
The prefix 'herum-' often describes movement without a clear goal or movement in a circle. It can also express that an action continues for a longer period of time.
Die Katze läuft schon seit einer Stunde im Wohnzimmer herum.
The cat has been walking around the living room for an hour already.
When 'herumlaufen' (to go around) describes clothing, it is almost always followed by a preposition such as 'in' or 'mit' that names the item of clothing. Without this detail, the meaning 'to walk around aimlessly' is assumed.
Er läuft oft mit einem lustigen Hut herum.
He often goes around with a funny hat on.
In the figurative meaning, 'herumlaufen' (to go around) is used with impersonal or abstract subjects such as 'das Gerücht' (the rumor), 'eine Geschichte' (a story), or 'die Nachricht' (the news).
In der Firma läuft die Geschichte herum, dass ein neuer Chef kommt.
A story is going around at the company that a new boss is coming.
to wear / carry
Both words can describe clothing that a person has on their body. Tragen neutrally names the item of clothing, while herumlaufen additionally emphasizes that someone is out and about in it and often attracts attention or looks inappropriate. Tragen fits the clothing itself, while herumlaufen is more suitable for describing someone’s public appearance.

Mika läuft den ganzen Tag in diesem auffälligen roten Anzug herum.
Mika has been going around all day in that striking red suit.
Mika trägt zu der Feier einen auffälligen roten Anzug.
Mika is wearing a striking red suit to the party.