Traveller's Guide: Iceland

The name doesn't sound too appealing?

Considering that Iceland dangles from the Arctic Circle between the North Atlantic and the Arctic Sea, the weather on this singular island isn't too bad. Long summer days average 14C, and the pristine wilderness of rugged coastlines, lava deserts, glaciers, volcanoes and ice-caps are appealing in a stark, romantic way; this is a superlative place to immerse yourself in the great outdoors. Iceland is also comfortably small, measuring just 500km wide by 410km deep, so a week or two is enough to cover most of the sights – and even to cross the seasonally inaccessible, uninhabited interior.

Iceland's name is down to the first person to attempt to settle here, the Norwegian adventurer Floki Vilgerdarson. Although Iceland may have been visited by the Romans and some reclusive Christian monks, the country was uninhabited until Vilgerdarson followed his pet ravens to landfall around 860AD. But after a harsh winter wiped out his farm, he christened the country Island ("Ice Land") as a warning to others and returned to Norway.

Soon after, the Vikings expanded from Norway and Sweden. By 930AD some 60,000 of these free-booting farmers had decided Iceland wasn't so bad after all. They had founded a Commonwealth whose entire population gathered annually to draft laws and settle disputes.

At Thingvellir (00 354 482 2660; thingvellir.is/english) you can see the 4km-wide rift valley where Iceland's Viking parliament, the Althing, used to meet. The focus is Almannagja, the 130ft-high western rift wall, featuring the Logberg or "Law Rock", where the laws were recited and important decisions were announced. These included the adoption of Christianity as the national religion in 1000AD.

The Commonwealth eventually broke down and, following a period of civil war, Icelanders accepted Norwegian sovereignty in 1262. After 1397, this devolved to Danish rule. By the 19th century, harsh trade restrictions and some appalling natural disasters – Iceland, as recent events have shown, is seismically hyper-active – had halved the population and beggared the surviving tenant farmers.

Iceland regained independence in 1944 and has developed into a modern, mostly urban nation: more than half its 300,000 inhabitants live in the capital, Reykjavik. Iceland's small population and limited resources mean that the economy has always been very sensitive. Commercial fishing was the economic mainstay until fish stocks collapsed following the Second World War – hence the ensuing "Cod Wars" with Britain, when Iceland defended its territorial fishing rights. Iceland shifted its economy to banking during the 1990s, until the global crash of 2008 again burst the country's financial bubble.

Iceland makes the most of its geographical advantages as a North Atlantic crossroads for aviation: Icelandair (0870 787 4020; icelandair.co.uk ) offers stopover deals for passengers from Heathrow, Manchester and Glasgow who are tempted to pause en route to North America. And since the eruption of Eyjafjallajokull, which led to the shutdown of European air space, interest in this fragile land has soared.

Where to begin?

Reykjavik. This is Iceland's largest settlement by far, but with a low-rise centre less than two kilometres across it's also pleasantly manageable and relaxed. A wander around Austurvollur Square and the main shopping drag, Laugavegur, will reveal a clutch of brightly painted older corrugated-iron homes, the ponderous national parliament building and delightful Tjornin – a large pond full of nesting wildfowl.

Overlooking this to the east, Hallgrimskirkja is a 240ft-high church whose façade of hexagonal concrete columns echoes volcanic formations; the tower offers fantastic cityscapes. For more views north to the snow-streaked Esja plateau, follow the harbourside walk along Saebraut, passing the shiny "Solar Voyager" sculpture and winding up at the old harbour (where you can see Iceland's whaling fleet, their funnels marked with an "H"). To soak up some history, head south of the centre to the National Museum (00 354 530 2200; natmus.is ) whose exhibits cover everything from evidence of Iceland's first visitors through to Bjork albums. It opens 10am-5pm daily; admission ISK600 (£3), free on Wednesdays.

For a stylish, moody art deco experience in central Reykjavik, try Hotel Borg (00 354 551 1440; hotelborg.is ). Rooms come in at around ISK41,000 (£205). Less expensive, family-run places such as Hotel Othinsve (00 354 511 6200; hotelodinsve.is) and Hotel Leifur Eiriksson (00 354 562 0800; hotelleifur.is ) have rooms from around ISK20,000 (£100).

Reykjavik is rich in cafés and restaurants too, not to mention the clubs which have deservedly garnered the city a reputation for riotous nightlife. NASA (00 354 511 1313; nasa.is ) is the place for music, and Hverfisbarinn (00 354 669 1105; hverfisbarinn.is) somewhere to pose. Everywhere you'll encounter teenage groups doing the runtur bar-crawl. As drinking out is expensive – a lager can cost upwards of ISK800 (£4) – some visitors take a few swigs of duty-free before hitting the town.

What about the Vikings?

Remains of a Viking longhouse were recently found right under central Reykjavik, displayed in situ at the Settlement Exhibition (00 354 411 6300; reykjavik871.is ). Dated to 87(12A)D by an overlying layer of volcanic ash, the oval stone wall possibly marks the homestead of Iceland's first settler, Ingolfur Arnarson. It opens 10am-5pm daily, admission ISK600 (£3). Down the road, the Culture House (00 354 545 1400; thjodmenning.is ) preserves the original medieval Saga manuscripts. More historical novels than straight history, the Sagas are told in plain, direct language which paints a vibrant picture of Viking times. The greatest include Njal's Saga, recounting a 50-year-long clan feud; the Laxdaela Saga's tragic love story; and Egil's Saga, the vivid tale of an unpleasant but talented pirate. It opens 11am-5pm daily, admission ISK400 (£2).

Southwest of Reykjavik, Hafnarfjordur town is home to Fjorukrain Viking Village (00 354 565 1213; fjorukrain.is ), which has an annual Viking Festival in mid-June. Some Icelanders are a little embarrassed by the festival – they're proud of their Viking heritage but hate to see it hammed up. For the real thing, head up Iceland's west coast from Reykjavik to the Settlement Centre (00 354 437 1600; landnam.is ) at tiny Borgarnes. Aside from explaining how the Vikings first discovered Iceland, there's a ghoulish section about the life of Egil Skallagrimsson, brutish hero of Egil's Saga, who grew up nearby. It opens 10am-7pm; admssion is ISK1,100 (£5.50) for one exhibition and ISK1,600 (£8) for two.

History plus landscapes?

Make the day-long Golden Circle tour from Reykjavik. This region is easy to explore by car; expect to pay around £70 a day to hire a vehicle, and about £1 a litre for petrol. An alternative is to book a trip with Reykjavik Excursions (00 354 580 5400; re.is ), which charges ISK 9,800 (£49) for a day trip. The itinerary includes Thingvellir, venue for Iceland's Viking parliament, and the sight of the incredibly clear water filling the nearby Peningaja ravine – which hints at the remarkable scuba diving that the adjacent lake, Thingvallavatn offers. To dive here, contact the Sport Diving School of Iceland (00 354 663 2858; dive.is ).

Next stop is Geysir ( geysircenter.is ), the hot blowhole after which all other geysers are named. Geysir itself is dormant, though adjacent Strokkur – the Churn – reliably erupts every few minutes, shooting off a 100ft spout. Keep your distance.

A final 8km past Geysir brings you to mighty Gullfoss, the "Golden Falls", which powers through a tight canyon, turns nearly 90 degrees, and drops again. You can pick up on the thunder and mist from miles away, and with a backdrop of the Interior's distant snowy peaks, it's a stirring sight – best when the afternoon sun picks out rainbows in the spray.

Somewhere further afield?

For a total change of scenery, head to Myvatn in northern Iceland. The name isn't too promising – it means "Midge Lake" – but aside from the flies there's plentiful wildlife, boiling mud pools and amazing lava formations. Birders come to clock up rare ducks and gyrfalcons, but nobody should miss the views from the top of Hverfjall's extinct cone, underground hot springs at Grjotagja, bubbling solfataras at Hverir and the steaming, Satanic mess left behind by a 1977 to 1984 eruption at Leirhnjukur.

North of Myvatn, Husavik has become Iceland's de facto whale-watching capital. There is an excellent museum (00 354 414 2800; whalemuseum.is ) open 9am-7pm daily, admission ISK1,000 (£5), plus tours heading out to sea daily in summer to find dolphins, humpback whales and fin whales. Specialists include Gentlegiants (00 354 464 1500; gentlegiants.is ) and North Sailing (00 354 464 7272; northsailing.is ). A typical trip lasts around three hours and costs €47.

Any, er, volcanoes?

Plenty. That trip along Route 1 will take you within erupting distance of Eyjafjallajokull, which whimpered to a halt a month ago. It is around 100km east of Reykjavik. Several operators run day trips from the capital to the volcano. Nearby Hekla is one of Iceland's most active volcanoes – it blows its top every decade or so. The 1,500m summit is usually covered in cloud. (Hekla translates as "hooded"). It's best viewed from Route 26, along its western flank. The fit and fearless can also hike to the summit; a trip through Arctic Adventures (00 354 562 7000; adventures.is ) costs ISK29,990 (£150).

You need not travel so far: on a clear day, look north across the sea from Reykjavik for distant views of Snæfell, a perfect snow cone that featured in Jules Verne's Journey to the Centre of the Earth. The mountain sits at the tip of the Snaefellsnes peninsula, accessible by bus from Reykjavik via the township of Hellisandur ( bogf.is ).

Vestmannaeyjar comprises a group of volcanic islands just off Iceland's southwest coast – you can fly from Reykjavik on the domestic carrier, Air Iceland (00 354 570 3030; airiceland.is ) for ISK8,505 (£43) each way, or sail from Thorlakshofn with Eimskip (00 354 525 7000; eimskip.com ) for ISK2,660 (£14) each way.

The main island, Heimaey, has two volcano cones, the newest of which, 205m-high Eldfell, popped into being in 1973 in an eruption that doubled the island's width and partially destroyed Heimaey town. The still-steaming summit is a straightforward climb.

What else can I do outdoors?

Just about anything that doesn't involve sunbathing. Prime V Chiking spots with marked routes include the massive canyon system at north-easterly Jokulsargljufur ( vatnajokulsthjodgardur.is ); the three-day Laugavegur trail between Landmannalaugar's hot springs and gorgeous Alpine valleys at Thorsmork ( fi.is/en/hiking-trails ); and around Thorsmork itself. You'll need to be self-sufficient.

Wildlife-spotting is another rewarding pastime. Iceland's birdlife includes fairly common puffins and rarer sea-eagles, harlequin duck and barrow's goldeneye. Arctic fox are the largest native mammal, though there are also small herds of introduced reindeer. Fishing is popular but you need permits – and a lot of money if you're after Iceland's salmon ( angling.is ).

For sports, try dog-sledding ( dogsledding.is ), bus trips across the interior ( trex.is or sba.is; summer only) or climbing Iceland's highest free-standing peak, 2,110m-high Hvannadalshnukur ( mountainguides.is ). There isn't much skiing available in Iceland, only the fairly basic Blafjoll area outside of Reykjavik ( randburg.com/is/ski ). Meanwhile, Icelandic horses are stocky purebreds descended from medieval Nordic animals and have a sort of smooth fifth gear (along with walk, trot, gallop, canter) called "tolt". One recommended operator is Ishestar ( ishestar.is ).

Sounds exhausting. Where can I flop?

Icelanders relish their country's natural thermal spas. Just about every township has an outdoor heated swimming pool with hot tubs and sauna, where locals unwind and gossip. The pick of the pools are Reykjavik's 50m-long Laugardalslaug (00 354 553 4039); Borgarnes' public pool, which overlooks the ocean; Jarthbothin near Lake Myvatn ( jardbodin.is ), set among steaming volcanic hills; and the remote Grettislaug, a basalt-block pool on a beach in northwest Iceland, used by the 11th-century outlaw Grettir Asmundarson to thaw out after he had swum ashore from his island hideout.

Best of all – but accessible only during summer – are the hot springs at Landmannalaugar, in the interior. These bubble up from underneath a solidified lava flow and mix with a cold stream; you wade up through the cold water until you find a spot where the temperature is just right, then immerse yourself.

How frightening is the food?

On a day-to-day basis, not at all: the burgers, pizzas and hot-dogs served up in most rural restaurants are dull, rather than scary. There's a mix of French, Italian, Chinese and Thai restaurants in Reykjavik, along with modern Icelandic places offering superb lobster, salmon and lamb dishes; Sjavarkjallarinn ("Seafood Cellar" 00 354 511 1212; sjavarkjallarinn.is ) is well regarded for its Asian-influenced fusion cuisine.

Hard-core foodies can hunt down traditional foods, too, either in Reykjavik's restaurants or supermarket freezers: gravadlax (cured salmon); wind-dried cod (harthfiskur); eye-wateringly pungent hakarl (fermented Greenland shark); inoffensive smoked lamb (hangikjot); whale meat; smoked puffin; svith (boiled sheep's head); and sursadir hruutspungar, pickled ram's testicles.

A dip with a difference: The Blue Lagoon

A soak at the surreal Blue Lagoon (00 354 420 8800; bluelagoon.com ; open 9am-9pm daily, admission €28) will convert you to outdoor bathing in Iceland. It's located conveniently close to Keflavik airport among a barren expanse of black lava boulders. The lagoon's mineral-enriched, milky-blue waters well up into a large pool at an enervating 38C, and a dip is said to be good for your skin. It's not good for your hair, though – rub in conditioner before bathing. You can reach the Blue Lagoon by getting one of the four Grindavik buses that leave daily from the main bus station close to Reykjavik's town airport, fare ISK850 (£4.25) one-way.

Even if you are merely passing through en route between Europe and North America, you can make a splash at the Blue Lagoon. Some flights from Britain arrive in time for a couple of hours of relaxation before the onward flight.

Travel essentials: Iceland

When to go

June to August is the main tourist season, when all businesses are open, roads are accessible and bus services are running. May and September are also worth considering. At other times prices are lower and people are that much happier to see you. Skip New Year and Christmas; everything is shut.

The weather is mild and wet in summer, but temperatures in winter sink as low as –20C. Don't expect much sun, whatever time of year.

Getting there

Icelandair ( icelandair.co.uk ) flies from Heathrow, Glasgow and Manchester; Iceland Express ( icelandexpress.com ) flies from Gatwick and Birmingham. International flights land at Keflavík, about 45km from Reykjavík, with easy bus connections to the city centre.

If you insist on taking your car, the Norrona car ferry ( smyril-line.com ) sails to Seythisfjorthur in eastern Iceland from Esbjerg and Hanstholm in Denmark.

Money

The Icelandic currency is the krona, which is about 200 to the pound. Change in Iceland, not in the UK. Almost no industry and a dependence on imports have made Iceland one of the most expensive countries in the world, despite the 2008 crash. Come prepared to pay more than usual for everything.

Getting around

Iceland's long-distance bus network is fully operational only between June and October. Timetables and bookings can be made through bsi.is and sba.is .

Highway 1, or the Ringroad, circles the country. It is fully surfaced, and stays open all year except in extreme weather. Other roads can be closed at short notice by bad weather. Car-rental companies include Avis (00 354 591 4000; avis.is ), Europcar (00 354 461 6000; europcar.is ), Hasso (00 354 555 3330; hasso.is ) and Hertz (00 354 522 4400; hertz.is ).

Dangers

Come prepared for Iceland's weather, with warm, weatherproof clothing. Outside Reykjavik, even apparently large "towns" rarely have more than a single street with a fuel station and a couple of shops.

David Leffman is the author of the new DK Eyewitness 'Top 10 Travel Guide: Iceland', which is published this month, priced £7.99

Additional research by Rosemary Schwitzer