43 Best Hotels in Iceland

This family-owned guesthouse may not feature every luxury amenity under the sun, but the serenity and breathtaking views have few comparisons in all of Iceland. The unbelievable natural vistas include eagles swooping overhead and frequent appearances by the northern lights. The minimalist design includes some quirky choices, with each room named after a specific cow from the on-site farm and decorated in color palates modeled after brands of tractors.

The loudest noise you'll hear at this beautiful 1890 house is birdsong, and although luxury amenities are not the focus, there's no substitute for the coziness of staying at this family's home. You can reserve a double room or a larger room if traveling as a family.

At 469 meters (1,539 feet), Fjalladýrð is the highest farmstead accommodation in Iceland, and a night here gets you a little closer to the stars and offers even better views of the northern lights in winter. Located at the expansive Möðrudalur farm, it's an ideal place to explore the Highlands, especially the Askja and Kverkfjöll routes. Accommodations are a cool mix of upscale private hotel-style rooms (that include breakfast), cheaper guesthouse rooms with shared bathrooms, sleeping-bag dormitories, family cottages, and a campsite. 

Although there's hardly any lodging in Dragsnes, Malarhorn really hits a home run when it comes to variety, as guests have a choice between three houses: House 1, with 10 double rooms that have private patios and bathrooms; House 2, with four double rooms that share a living room and kitchen; and House 3, with a family-size room, a two-bedroom apartment, four double rooms, and a superior double room with private entrance. Breakfast will cost you extra.

Evidence that Icelanders will renovate almost any building to turn it into a guesthouse, the Milk Factory was once—you guessed it—a milk factory, and the stylish redesign has resulted in modern, minimalist rooms, including family rooms that sleep four (with beds on a mezzanine level). It's a friendly place with thoughtful touches, and it's open year-round.

On the outskirts of Borgarnes, you'll find this guesthouse, which manages to give you the convenience of being near town yet the quiet of being in the middle of nowhere at the same time. There are different-size rooms in the main house, but you can also rent a private house behind the farm if you're traveling with a larger group. Way back when, the rooms in this guesthouse served as stables, barns, and poultry houses. There is a private wing that includes a double room and two family rooms with shared bathrooms and a separate kitchen.

For a more authentic local experience, you can do a homestay at Blómasetrið, which also has a café and gift shop on-site; or, for a little more privacy, you can stay in one of the apartments. No matter where you're sleeping, though, you can count on incredible views of Mt. Hafnarfjall. At the family's home, you can choose between three rooms: Caring & Friendship (twin room), Love (double room), or Peace (the family room). There is one two-room apartment available to book as well as two studio apartments, Traustastofa and Freyjubrunnur.

Located 90 minutes from Hólmavík, this family-run hotel has its own unique and fantastical charm that makes it the very definition of rural. There's a swimming pool with a swing rope inside a slightly dilapidated greenhouse as well as a natural hot spring across the river. The surrounding valley is home to over 40 species of birds and experienced hikers can make their way to a mountain-top trout fishing lake. The hotel is also a horse farm and offers guided tours of the surrounding area. The rooms have the necessary creature comforts and the restaurant is simple but excellent, although parts of the hotel are overdue for renovations.

You have three options at Fossatún Country Hotel: booking a room in the main hotel, staying in the communal guesthouse, or renting a camping pod. The latter is a tiny home of sorts—a primitive (but solid) structure; it resembles camping but takes you a step out of the unpredictable Icelandic weather. The owner of this property is a writer, whose stories tell about trolls and the hotel's setting. A number of self-guided walks reveal the local inspiration behind his tales.

Fosshotel is a regional chain known for friendly and dependable service, and the Stykkishólmur location is no exception. You won't get the same cozy vibe as at some of the guesthouses in the area, but you will get your own private room and bathroom. The hotel restaurant offers great views to go with your meal.

Despite its businesslike vibe, this outpost from the Fosshotel chain is a solid choice for your stay in Patreksfjörður, and you'll get the trusted service this brand is so well-known for. There are certainly trendier Fosshotel locations, like Fosshotel Glacier Lagoon, but you can't beat the proximity to Látrabjarg and Dynjandi.

Sitting proudly alongside the Varmá River, the Frost and Fire hotel offers proximity to nature while just a short walk from shops and restaurants. No need to go far for dinner though—the excellent Varmá restaurant is right next door.

At this unique and artistic guesthouse on a quiet street, each room is special and made out of driftwood and volcanic stone. The hosts go out of their way to make guests feel welcome and offer airport pickup with advance notice.

Located in the beautiful Flóahrepp countryside, right along Route 1 near Selfoss and Hveragerði, this guesthouse with views over the mountain Hekla was initially built as a women's prison (though those plans were never realized).

This beyond-charming guesthouse has five rooms, two communal sitting areas, a library, and a big garden with views of the nearby fjord. This is the place to go if you want to feel like family far away from home.

This modern hotel sits by a peaceful harbor at the northern end of Keflavík in close proximity to the airport. It offers comfortable and cool rooms, as well as a chic common area and a romantic outdoor pool to relax in after a long day.

This hotel manages a good balance of business amenities and cozy and comfortable rooms. Each room has a private bathroom and Wi-Fi. The on-site restaurant, Café Bifröst, serves up a range of coffee, entrées, and snacks. Guest rooms are bright, the mountains offer unbeatable scenery, and a ton of hiking and biking trails surround the property. Be warned: the hotel and restaurant are located on a college campus, so it can get busy and a bit loud.

This guesthouse, located one hour outside of Patreksfjörður, offers up rooms with private bathrooms, shared facilities, and campgrounds, making it an ideal spot to meet up with fellow travelers. The amenities may be basic, but its proximity to the picturesque puffin cliffs of Látrabjarg can't be beat.

This charming country hotel dedicated to the Icelandic horse is located right off the Ring Road, only a few minutes’ drive from Hveragerði. Each room is simple but bright, with a private bathroom and a door that leads directly outside. There's also a hot tub to relax in after a long day of riding. 

In the 1930s, a group of Catholic nuns traveled to Stykkishólmur to start a community, building a chapel, monastery, and hospital; today, the chapel still serves as a place for travelers to rest as Hotel Fransiskus. It's connected to the hospital, so don't be alarmed when you drive up wondering if you've got the right place.

Family-run for more than 30 years, this hotel sits in a valley just five minutes from the magnificent Gullfoss. Visitors can take a beautiful walk up the old road to the waterfall in the morning or evening, dodging the crowds.

The striking views are the main attraction here, but the simply decorated guest rooms are a comfortable place to lay your head after a day of hiking the nearby mountain or fishing at the harbor. There are options for shared or private bathrooms, and the hotel staff can help set up activities for your stay.

Located in the heart of the city, Hótel Ísafjörður is a great base for exploring the museums and restaurants in the area. Its central location means that noise can make its way into the hotel. The hotel chain includes four other hotels and guesthouses in the Ísafjörður area, so they may have other options available if Torg is booked.

The geothermal swimming pool and adjacent natural hot spring are the biggest draws here at the remote Hotel Laugarhóll. The rooms at this former boarding school may be fairly basic, but there's a gymnasium (where they host occasional events), stick-to-your-ribs home cooking made with local ingredients, and stunning views from the pool. The hotel is 20 minutes away from Drangsnes and Hólmavík in each direction.

You've got options at Hotel Laxarbakki: there are single, double, twin, and family rooms as well as a charming cottage. With a children's playground, hot tub, and sauna on-site, there's something for everyone.

Across the street from the hilltop church of Hallgrímskirkja, this hotel is a short walk from most of Reykjavík's major attractions. Some guest rooms have balconies. Interiors are cozy, with hints of Scandinavian design here and there, and give off the vibe that you're staying with a good friend instead of at a nondescript hotel.

Situated downtown, this hotel has rooms decorated in calm neutral tones and common areas with lots of natural light thanks to the glass ceiling over the lobby. In the basement, there is a museum built around the remains of a Viking longhouse from the 9th century that was found during the construction of the hotel.

Located right next to Lake Tjörnin on one of the city's main streets, this hotel features intimate, handsomely appointed rooms and numerous communal spaces. The hotel's gym and spa are available for guests, as well as two roof terraces, an outdoor patio, and a glass atrium.

Sitting on the banks of the grand river Ölfusá with views of the nearby mountain, Hótel Selfoss offers tranquility just a few minutes' walk to the town center, with all its restaurants and shops. The hotel also has its own restaurant, bar, and spa.