There is a long-standing experimental observation that the melting of topologically constrained DNA, such as circular closed plasmids, is less abrupt than that of linear molecules. This finding points to an important role of topology in the physics of DNA denaturation, which is, however, poorly understood. Here, we shed light on this issue by combining large-scale Brownian dynamics simulations with an analytically solvable phenomenological Landau mean field theory. We find that the competition between melting and supercoiling leads to phase coexistence of denatured and intact phases at the single-molecule level. This coexistence occurs in a wide temperature range, thereby accounting for the broadening of the transition. Finally, our simulations show an intriguing topology-dependent scaling law governing the growth of denaturation bubbles in supercoiled plasmids, which can be understood within the proposed mean field theory.