A Guide to Driving in Iceland
Driving around Iceland is the easiest way to see as much of this beautiful country as possible, and that’s exactly why so many travellers choose to take to the Icelandic roadways when visiting.
However, no matter how sure of your driving skills you may be at home, it’s still important, while visiting a foreign country, to brush up on the laws of the road and the driving specificities of that country. If you plan on driving in Iceland during an upcoming trip, take a look at our full guide to driving in Iceland below — so you can be safe on the road and have as much fun during your Iceland adventure as possible!
Why rent a car in Iceland?
As we said, renting a car in Iceland is the easiest way to see the country in full. You can see the beautiful landscapes on your own time, without waiting for public transportation (which might not even take you to all the spots you want to visit — some destinations around Iceland are only accessible via private car) or a tour guide. You’re free to come and go as you wish, and discover all of the sights in Iceland that you most want to see, when and how you want to see them.
Plus, when you rent a car with Lava Car Rental, you’ll be further equipped to see all of Iceland’s cities and countryside in the ultimate convenience, thanks to special perks like discounts on fuel, 24/7 assistance, airport pick-up, and more. No matter where you’re going, who you're travelling with, or what your needs are, we have the perfect rental car for you.
Is driving necessary in Iceland?
While you don’t necessarily need to drive yourself around while visiting Iceland, self-driving is the best way to get the most out of an Iceland trip. Sure, you can find group tours that provide transportation and you could even possibly just stay around Reykjavik and use public transportation. But, if you want to see as much as possible of Iceland, at your own pace, more economically, self-driving is the way to go.
Self-driving allows you to completely tailor your holiday to exactly your travel preferences and style. Want to see all of Iceland’s volcanoes? Plan a volcano road trip. Want to travel Iceland’s Ring Road? Do it at your own pace, whether it takes you one week or three. Simply want to go where you want, when you want, no tour guide required? Renting a car in Iceland makes it possible.
But, if you want to learn more about all of your transportation options while in Iceland check out our full Iceland transportation guide.
Things to know before driving in Iceland
There are a few things you’ll want to do and consider before driving in Iceland.
- Choose the right rental car.
Based on where you’re going and what you plan to do, make sure to choose the right rental car for your Iceland driving trip. You’ll need a 4x4 vehicle if you’re visiting during the winter months or plan on visiting the Highlands (which are only open during the summer). If you want to camp while in Iceland, you’ll need to rent a campervan. Otherwise, if you don’t plan on doing any winter travel or mountain travel, you can save a little money by renting a budget vehicle.
For more information on what car might be right for you, check out our guide to renting a car in Iceland.
- Budget wisely.
Before booking a rental car, consider what your budget will allow. Don't just look at the main rental fee and assume that’s the only fee you’ll incur. Beyond the rental fee, you’ll also need to purchase insurance and gas. If you want to save some money while driving in Iceland, you might want to consider renting a diesel car like the Dacia Duster, since diesel is cheaper than petrol.
- Book in advance.
Definitely make sure to book your rental car well in advance of your travel. Iceland rental cars are often quite in demand, especially in the summer months, so waiting longer to book can mean higher rates and fewer options.
- Know the rules of the road.
Driving in Iceland can be very different from driving in your home country. Familiarise yourself with Iceland’s road regulations, road signs, speed limits and licence requirements. Be prepared for the different types of roadways in Iceland, too, including the varying rules that apply to them (for example, you’re only legally allowed to drive a 4x4 vehicle on F-roads).
- Know what to do in an emergency.
The emergency number in Iceland is 112. If you have an accident or need help during a fire, criminal act or natural disaster, you can call or text this number. Additionally, have the breakdown number for your car rental company with you.
If you do end up in an accident, stay in your car and call for help immediately.
How easy is driving in Iceland?
Driving in Iceland is very easy when you stay on paved roads (including the Ring Road). These paved roads are typically in very good condition, with lots of signage and low traffic. The only things that can make your experience difficult are inclement weather and general unfamiliarity with Iceland's driving rules. When you get onto unpaved roads like the F-roads, driving becomes a little more difficult. Read our guide to the F-roads in Iceland to find out why.
Where to Drive in Iceland
Once you’re convinced that renting a car in Iceland is the way to go for your upcoming Iceland trip, you have to decide where exactly you want to drive in Iceland. Here are a few of our favourite options.
The Ring Road
The Ring Road, also referred to as Route 1, is the most popular roadway in Iceland and for a good reason — it circles the entire island and takes you to all of the top spots in the country. The 832-mile/1,339-kilometre road is mostly paved (though you will have to watch out for a few stretches of gravel roadways in the east) and a two-lane highway, with a 55mph/90km/h speed limit.
If you were just to drive around the Ring Road, with no stops, it would take you about 17 hours, but obviously, you want to make some stops. That’s the whole reason you’re in Iceland! Different travellers traverse the Ring Road at different speeds. It all depends on the pace you’re after and how many places you want to see on the Ring Road; some travellers spend a few weeks on the Ring Road, while others cram their entire journey into five or six days. We usually recommend taking between seven and 10 days on the Ring Road, which allows you to see the majority of the top spots without rushing.
Some of the most popular stops along the Ring Road include, of course, Reykjavik, as you can’t visit Iceland without exploring our biggest city; Vik, a southern, remote village known for its proximity to the Myrdalsjokull glacier, beautiful beach, and cliffs full of puffins; Jokulsarlon, a glacier lagoon at the edge of Vatnajokull National Park, with a black sand beach and a huge seal colony that visits during the winter months; and Myvatn, a volcanic lake in the north surrounded by hot springs.
Of course, these favourited stops only scratch the surface of all that the Ring Road offers!
One area of Iceland that a Ring Road trip does not include? The dramatic landscapes of the Westfjords. In the west of Iceland, the Westfjords is a peninsula that boasts some of the most awe-inspiring sights in the entire country — but they go relatively untouched and unseen compared to some of Iceland’s other, more accessible spots. So, if you’re seeking fewer crowds and lusher landscapes, it’s the Westfjords you’ll want to explore while driving in Iceland.
Some of the must-see spots in the Westfjords include Raudasandur, a pink sand beach; Dynjandi waterfall; and the Latrabjarg cliffs.
The Golden Circle
For those who want to see some of Iceland’s top, most popular spots, but who don’t necessarily have enough time to traverse the entire Ring Road, the Golden Circle is a nice pick for a driving trip through Iceland. Smaller, it’s only 300 kilometres/186 miles, so a good deal shorter than the Ring Road route.
The easy-to-follow, well-traversed road takes you to popular spots such as Gullfoss Waterfall, The Great Geysir and Thingvellir National Park. It also goes through Reykjavik, which is convenient for those staying in the city.
Like the Westfjords, Iceland’s Highlands are not accessible via the Ring Road, making them a little less popular with most travellers. However, for the intrepid adventurer, the Highlands is a playground filled with fun. The stunning landscapes of the Highlands are considered volcanic deserts; rough and mostly uninhabited, they offer views unlike any you’ll find elsewhere in the world.
But, with such rugged terrain comes to a few challenges. Visitors wanting to drive in Iceland in the winter will find that the Highlands roads are only open in the summer, and only accessible to 4x4 vehicles, as some of the roads do require river crossings. Still, for those drivers in Iceland who aren’t scared of a little challenge, the Highlands are well worth a summertime trip.
How to Drive in Iceland
Have your dream Iceland itinerary mapped out? Great! But, before you can jump in your rental car and start driving around Iceland, you’ll need to know a few more things.
What do you need to drive in Iceland?
If you’re coming from another country to drive in Iceland, you’ll need a valid driver’s licence from your home country. The only licence requirements are that your licence is written in the Latin alphabet (or that you have an English translation of your licence) and that your additional drivers in the car likewise have licences to show.
You’ll also need a valid credit or debit card in order to rent a car in Iceland. If you rented your car through a travel agency, you’ll need to show the travel agency’s voucher.
Lastly, Iceland only allows drivers over a certain age to rent vehicles; only drivers aged 20 and older, who have held a driver's licence for a year or more, are permitted to rent vehicles.
What are the road regulations in Iceland?
There are a few road regulations here in Iceland that you’ll need to be aware of in order to safely drive throughout the country. These may be different from the road regulations you’re familiar with within your home country, so it’s important to study them closely and commit them to memory ahead of your Iceland driving trip.
In Iceland, we drive on the right side of the road and overtake slower traffic from the left side of the road. In roundabouts with two lanes, the traffic on the inner lane has right of way over traffic on the outer lane (which can be a big change for some international travellers).
In some cases, particularly on bridges in the more rural areas of Iceland, you’ll find that the two-lane highway narrows, leaving only enough room for one car at a time. In these instances, the vehicle closest to the bridge has the right of way.
Everyone in the vehicle is required by law to wear a seatbelt while the vehicle is in motion. Similarly, younger children and infants must be seated in child safety seats (you can rent these for use with your rental vehicle — just ask!) and children under 12 years of age are not permitted to ride in a car’s front seat.
You must have your vehicle headlights turned on at all times while driving in Iceland, regardless of the time of day or weather.
There is a zero-tolerance policy for all mobile phone usage while driving, as well as driving while impaired by either alcohol or drugs.
Icelandic speed limits are 30-50 km/hour (31 mph) in populated areas, 80 km/hour (50 mph) on gravel roads in rural areas, and 90 km/hour (56 mph) on paved roads. While you may think you’re safe to speed if you don't see law enforcement on the roads, think again; Iceland uses speed cameras along roadways to track passing vehicles' speeds and issue fines where needed.
All off-roading is illegal in Iceland; however, don’t confuse off-roading with using some of Iceland’s F-roads, which you’ll find in the Highlands. These roads are dirt and typically pretty simple, but they are marked, so you can distinguish using an F-road from off-roading. To be safe, if you don’t see any signs in a particular area, just don't drive there.
Other tips for driving in Iceland
Beyond the varying road rules in Iceland, the country’s road conditions can also sometimes prove challenging for international visitors.
Due to Iceland’s harsh winters and quickly-changing weather, vehicles must be outfitted with studded tires during the winter season, November through April. Unlike in other countries, tyre chains are not permitted. Additionally, during this same time period, it’s recommended that travellers rent only 4x4 vehicles, just to be safe when they encounter snowy and icy roads. Also, keep in mind that some roads are closed during the winter months, including the F-roads that access the Highlands; even in the summer months, mid-June to September, the F-roads are only accessible with 4x4 cars and when road conditions allow.
With summertime comes an entirely different challenge: sheep! Sheep are free to roam throughout Iceland in the summertime, so you may spot some crossing the roads. If you do see some Icelandic sheep, slow down and watch for any sudden movements. Other wildlife that you may spot on Iceland’s roads includes Icelandic horses and, occasionally, during the right times of the year and in the right regions, reindeer. However, the sheep are the most likely to impede your driving.
Mistakes to avoid when driving in Iceland
Just like when driving in any foreign country, there are a lot of things that can go wrong when driving in Iceland, especially if you make one of these 10 mistakes. Avoid them, for the best experience possible.
- Not checking (and abiding by) the wind and weather warnings.
There are multiple apps and websites you can use to stay up to date on Iceland’s weather and wind conditions. Use them and check them frequently during your Iceland road trip. If those resources tell you that it’s unsafe to drive — or even if they indicate that you may feel uncomfortable while driving — don’t plow ahead regardless. Take your time travelling and use your best judgment.
- Not obeying road closures.
Quite a few roadways around Iceland are closed during the winter, either for the entire season (like the F-roads) or just after certain weather events, until the roads are cleared. If a roadway that you intended to take on your Iceland road trip is closed, don’t risk it and try to drive on it anyway. You can get stuck and damage your car and potentially injure yourself.
- Trying to do too much in one trip.
Iceland is a big island. If you’ve visited island destinations in the past and easily fit everything you wanted to do and see into one week, don’t expect to be able to do the exact same thing in Iceland. As you plan, consider realistic travel times and give yourself plenty of time to do and see everything on your itinerary. Leave extra room or even extra entire travel days on your schedule.
For help figuring out what’s realistic during your time in Iceland, check out our multiple sample itineraries tailored to certain numbers of days on the island.
- Stopping in the middle of the road.
We know it’s tempting, but please — don’t stop in the middle of the road to take photos while you’re driving around Iceland. Likewise, don’t park on the side of the road or off the road (off-roading is completely illegal and subject to hefty fines in Iceland). Wait until you get to a designated parking area to take your photos. We promise you’ll have plenty of opportunities.
- Not filling your tank with gas.
If you think you might be running a little low on gas, don’t just decide to wait until the next station to fill up your tank. Gas stations are very spread out in many parts of Iceland, so you may not come upon another station until it’s too late. On that note, if you’re planning a lengthy Iceland road trip, it’s wise to keep extra fuel in a container in the back of your vehicle, as a precaution.
- Driving off the road.
As mentioned, driving off the road in Iceland can come with a huge fine if you’re caught. Don’t do it. Not only can you damage your rental car and cause injury to yourself and your passengers, but you’ll also damage Iceland’s fragile ecosystem.
- Not purchasing rental car insurance.
The right rental car insurance can make all the difference in your trip. Certain driving hazards exist in Iceland that don’t exist in other areas of the world, and you need to have the insurance to cover those hazards. Heavy winds, sand, volcanic ash and more can all cause damage that you don't want to pay for.
- Not paying attention to the entrance, parking and toll fees.
Just like anywhere else, you have to pay your driving-related fees in Iceland. Wherever you go on your Iceland self-driving trip, keep an eye out for signs that post any entrance, parking or toll fees that you’ll need to pay.
- Driving too fast.
Follow the speed limits and, if the weather is poor, reduce your speed even further. Wet, slippery, icy roads can prove more hazardous than you think. The same goes for roads during wind storms and blizzards.
Even if there’s no inclement weather, driving over the maximum speed limit in Iceland can result in police fines. Speed cameras around the country will track your vehicle and, if they catch you speeding, send you a fine.
- Not preparing.
Make sure that you prepare accordingly before any Iceland road trip. Take extra water and food with you. Pack an emergency driving kit. Store an extra tank of fuel in your trunk. Keep a flashlight in the car as well.
Gas and Petrol Stations in Iceland
Gas and petrol stations (and even electric charging stations for electric vehicles) are plentiful in Iceland — so long as you’re in the right spot. You can find service stations from popular brands such as OB, N1, Orkan, and Atlantsolia throughout most of the country, except for when you’re travelling between Vik and Myvatn. In this area, which is along the Ring Road and encompasses about half of the island, gas and petrol stations can become few and far between. If you plan on travelling between these two spots, keep an eye on your vehicle’s fuel levels. You don’t want to be caught with an empty tank.
Once at a gas or petrol station, you can choose to either pay with a credit card with a 4-digit PIN number or you can purchase a prepaid gas card from a service centre.
Where to get the cheapest fuel in Iceland
One place where you can save a bit of money in your travel budget? Trying to get a better deal on fuel for your rental car.
In general, brands such as ÓB, Orkan, Dælan and Atlantsolía offer the cheapest fuel prices in Iceland. N1 and Olís are typically more expensive.
The cheapest gas station in Iceland is the Orkan station in Bústaðavegur street, located in the capital area, with an average price of 249 ISK/litre of petrol. Otherwise, Costco Iceland also offers great prices but you need to have a membership card, and the gas station is located only in Reykjavik.
To further save money on fuel, you can rent a diesel car (like the Dacia Duster), as diesel is cheaper than gas. Don’t forget! When returning your rental vehicle to the rental car company, you’ll need to return it with a full tank of gas. The easiest and most convenient place to do this is at the Orkan station near the Keflavik Airport.
Parking, Tolls & Entrance Fees
Parking and entrance fees and tolls differ according to where you are in Iceland.
As you drive around Iceland, you’ll come across entrance fees and tunnel tolls. If you visit small cities and some of the more popular attractions, like Pingvellir National Park or Skaftafell National Park, you’ll be charged varying parking fees. Similarly, if you travel the Ring Road, you’ll pass through Vadlaheidargong, a toll tunnel in the north of Iceland; travellers can pay their toll fee online, at tunnel.is, within twenty-four hours before or after passing through the tunnel.
Keep a close eye on all signage on roadways and in parking areas to avoid any fines or fees that you might pick up from not properly paying for your parking or tolls. If you do incur some fines while driving a rental car in Iceland, the fine will be sent directly to your rental car company. From there, the rental car company will charge you a bill plus an additional service fee when you drop off the car at the end of your trip.
Parking in Iceland
We talk a lot about driving around Iceland, but eventually, you’ll need to actually stop and park at your destination. So what do you need to know about parking in Iceland? Here are a few basics.
Can I park anywhere in Iceland?
You cannot park on the sides of the road outside of the city, or off the road, or on private property. Do note that not many hotels in central Reykjavik offer parking for their guests, either (though, elsewhere in the country, this is not the norm).
If you’re driving a camper van rather than a car, additional restrictions apply. Check out our guide to camping in Iceland for more information about where you can or can’t park your camper van.
Is parking free in Iceland?
Parking is free just about everywhere in Iceland. The only times you may have to pay for parking are when you’re travelling through the largest cities, such as Reykjavik or Akureyri. You may also need to pay for parking at some of Iceland’s largest natural attractions, such as Thingvellir National Park, Skaftafell National Park, Seljalandsfoss waterfall or Fagradalsfjall eruption site. To verify, just check for signage. If you do need to pay, it’ll be clearly marked.
How do you pay for parking in Iceland?
So once you’ve determined that you do need to pay for parking in Iceland, how do you actually go about it?
In paid parking zones in cities like Reykjavik, you’ll have the option to pay for your parking with a mobile app (instructions for the mobile app will be on a sign; the app is called Leggja and can be downloaded either on the Apple App Store or in the Google Play Store), or at a nearby ticket machine or parking meter. The mobile app is by far the easiest way to pay for parking.
However, if you do need to pay at a ticket machine or parking meter, you’ll need to have a credit card handy, or some coins in quantities of 10, 50 and 100 ISK. The machines do not provide change. Input your licence plate number into the machine, as well as how long you expect to park in the spot and the machine will tell you how much to pay. You do not need a parking ticket. Any parking attendant will automatically know that you've paid to park if you properly input your licence plate number into the machine.
Is parking expensive in Iceland?
Metered parking fees are typically 90–250 ISK per hour, or approximately 0.63–1.76 EUR per hour, or approximately 0.70–1.95 USD per hour.
Parking garage fees are cheaper, 50–80 ISK per hour, or approximately 0.35–0.56 EUR per hour, or approximately 0.39–0.63 USD per hour.
Parking in Reykjavik
Reykjavik is split into four parking zones, primarily just in downtown. These zones are indicated with signage that clearly says “P” and gives further details on payment. If you don’t see a sign, you shouldn’t have to pay.
Area P1 is the most expensive Reykjavik zone for parking, with hourly parking rates of 250 ISK/1.8 EUR/2.17 USD; you’ll find most areas of inner Reykjavik and the most popular tourist spots are designated as P1. Area P2 is a little more affordable, with hourly parking rates of 125 ISK/0.9 EUR/1.08 USD. Area P3 charges hourly rates of 90 ISK/0.6 EUR/0.72 USD. Areas P1, P2 and P3 charge their rates from 09:00 to 18:00 on weekdays and 10:00 to 16:00 on Saturdays, only. Parking in these areas is free outside of these times.
Area P4 charges weekday-only hourly rates of 125 ISK/0.9 EUR/1.08 USD. The charges are only applicable between the hours of 08:00 to 16:00, Monday through Friday. Otherwise, parking in Area P4 is free.
Parking throughout all Reykjavik is free after 6 p.m. and all day on Sundays.
If you want to save a little money on parking in Reykjavik, choose to park in a multi-storey parking garage. These garages are more affordable. Most garages are open from 07:00 to 24:00. If you come back for your car outside of these hours, you’ll find that it’s closed and you cannot retrieve your car until it’s open again. Typically, multi-storey car parks charge you 240 ISK/1.69 EUR/1.87 USD for the first hour of parking and 120 ISK/0.84 EUR/0.94 USD for every subsequent hour.
Recommended multi-storey car parks and garages include:
- Kolaportið parking building on Kalkofnsvegur 1
- Vesturgata multistorey on the corner of Vesturgata and Mjóstræti
- City Hall on Tjarnargata 11
- Traðarkot on Hverfisgata 20
- Stjörnuport on Laugavegur 94
- Vitatorg on the corner of Skúlagata and Vitastígur
Parking fines in Iceland
If you don’t follow the parking rules in Iceland — like not paying for your parking space, parking in a handicapped space, or parking where you shouldn’t park at all — you may receive a fine.
Fines for not paying for a parking spot depend on whether you pay it immediately or later on. If you find yourself with a parking ticket, you can pay the fine by going to the nearest bank. If you leave Iceland without paying the fine, your rental car company will charge the cost to you later, plus an extra service fee.
Paying Tolls in Iceland
How do tolls work in Iceland?
In short, there is no fee or toll to drive around Iceland’s roads, whether you are driving the Ring Road or the F-Roads (mountain roads) of the Highlands. However, that being said, Iceland is not 100% toll-free and although there aren’t any toll roads, there is a toll tunnel that needs to be paid if you’re going to drive through it.
Which tunnels in Iceland do you have to pay for?
The only toll tunnel that you need to pay (if you’re passing through it) is the Vaðlaheiðagöng tunnel, which goes from Mývatn to Akureyri, in the North of Iceland. Driving this tunnel will save 16km (19 miles) of your journey if you’re traveling between both destinations.
The toll tunnel costs 1500 ISK (around $12 or 10€) and you need to pay it on the tunnel.is website. There is not a toll booth with an operator where you can stop and pay. The good news is that you can do it before or after driving the tunnel, so if you are not sure if you’re going to pass through it, you have still time.
What happens if you accidentally go through a toll?
If you drive through the Vaðlaheiðagöng tunnel, you can pay the toll up to 24 hours until/but no later than 24 hours after going through it. If you don’t pay the toll within that timeframe, it will be billed to the registered owner of the vehicle (if you’re renting a car, it will be the rental company) with an added collection fee that will be charged to the person who is renting that vehicle.
To prevent the toll from being collected with the extra fee, the best thing to do is to register the vehicle through tunnel.is website. The registration is free of charge and the toll will be automatically charged to your credit card whenever you drive through the tunnel without any extra collection charge.
Top Apps for an Iceland driving trip
Before heading out on your Iceland road trip, make sure to download these apps!
When driving in Iceland, the official Icelandic weather app is your place to go to get up-to-the-minute information on the current and upcoming weather, as well as warnings for potentially hazardous weather events ranging from volcanic eruptions to blizzards.
This app for Iceland’s emergency services allows you to easily send messages to the emergency service, as well as your GPS location.
This aurora forecast app is a must for anyone visiting Iceland during the winter months, who wants to drive to darker areas to go northern lights chasing.
The Iceland Road Guide app allows you to access offline maps that detail more than 3,000 points of interest around the country.
This Icelandic outdoors app is a free app that offers GPS tracks for hiking, trekking and walking around the country. It includes fun facts for the area you’re in, at any given time, and even offers hiking tours and ideas.
Find out exactly how Icelandic prices transfer to your home currency.
Get all the information you need about bar culture in Reykjavik, at your fingertips.
Download offline maps for use when you drive somewhere in Iceland without a cell signal.
And while these last two are websites, not apps, they’re still necessary: road.is and safetravel.is. The former offers up-to-the-minute road condition reports for the entire country, while the latter allows you to submit your travel plan and get safety alerts as needed along your route.
What if You Have an Accident on the Road?
While they’re never pleasant or expected, accidents can sometimes happen while you're out on the road. If you have an accident while driving in Iceland, you can call the Iceland emergency phone number, 112. It’s also a good idea to let your car rental company know about the accident as soon as possible; they can often lend some extra assistance.
Where to Rent a Car in Iceland
Feeling confident about your upcoming trip to Iceland? If you’re ready to hit the road, all that’s left to do is book your Iceland rental car.
Lava Car Rental is a local and experienced company with a huge selection of vehicles, ranging from economy cars to 4x4 vehicles ready for winter to campervans. We include your insurance in the price of your rental, don’t require an up-front deposit at the time of booking, and even let you cancel your rental for free if needed. We make the Iceland car rental experience as easy as possible.
Let us help you have the best (and safest) Iceland road trip possible. Check out our available rental cars and reach out. Our expert team is ready to help!