Best Car to Rent in Iceland: A Complete Guide for Every Season and Road Type

By Johanna Sigurðardóttir Verified Expert

Calling all adventure lovers and travel enthusiasts! We are your local Icelandic car rental experts, born near glaciers and brought up under the Midnight Sun, and we’re here to help you with the most crucial choice for a successful Iceland road trip: picking the best car to rent in Iceland.

You may have planned your dream Iceland road trip with an itinerary filled with waterfalls, the magical Northern Lights, and trying to pronounce Eyjafjallajokull without getting the old Norse gods out of bed, but renting the right ride can make all the difference between having a fantastic story to tell friends or just being a cautionary tale for others. So, read on if you’d like us to help you find your ideal Icelandic ride!

Why Choosing the Right Rental Car in Iceland Matters?

To get right to the point, do you have to rent a car in Iceland? Short answer: Big yes, unless you’re thinking about spending your days and nights in the coffee shops of Reykjavik (we get it; they are wonderful).

But here’s the thing: outside of our snug capital and other bigger city borders, public transport is as rare as sunbathing chances in December. Additionally, all those photo-worthy tourist spots—the roaring waterfalls, black sand beaches, and hot geothermal pools—are scattered throughout our rugged countryside. So, without your own ride, you’ll be missing out on a LOT of must-sees here on the island.

Iceland's rental cars are also as varied as its weather in order to cater to different people’s needs, preferences, budgets, and trip itineraries. So, finding your ideal ride depends on everything from your planned destinations and how much Viking-sized gear you're lugging to how well you handle gravel pinging off your car. That’s also why choosing the wrong vehicle can quickly turn your Icelandic adventure into a nightmare or leave you to do a lot of explaining to the insurance company.

Believe us, we've seen it all: hopeful couples in tiny 2-wheel drive cars trying our rough-and-tough off-road paths, large families thinking they would somehow get smaller, and daring travelers braving winter storms in massive RVs. We want to help you avoid these beginner blunders and plan your perfect Iceland trip with the best car rental Iceland can offer.

Key Factors to Consider Before Renting a Car

So, before you click on “book now” just yet, please consider the following when deciding on which car to rent:

Seasons and Weather Conditions

Iceland's weather can be as unpredictable as a mystery box bought on eBay. There’s a reason why one of our local sayings is that “you can experience all four seasons in a day in Iceland. That being said, you can generally expect the following from our seasons:

Summer (June to August)

This is the time when daylight seems to last forever! You can join Midnight Sun parties in mid-summer, read a book at 11 PM without straining your eyes, and enjoy a jam-packed itinerary filled with outdoor adventures.

The road conditions are also welcoming, and most routes, including many of the exciting F-roads in the Highlands, are open to visitors.

Summer gives you the most options when it comes to choosing the best car to rent in Iceland, since you’ll be able to take on most main roads with a regular 2-wheel drive. For those seeking a little extra adventure, our 4x4 routes will also be at their easiest to navigate.

Winter (October to March)

Get ready for our dramatic season! The days are short, with only 4 hours of daylight in mid-winter, and nature unleashes its full force with snow, ice, and winds that can disrupt your travel plans. This not only makes all road conditions tricky to navigate, but our F-road Highland routes are also closed for the duration of the season.

Therefore, if you’re looking forward to a winter road-trip adventure, you’ll need a rugged car (we highly recommend a 4x4, but if you opt for a 2-wheel drive, you’ll need to have all your winter accessories and gear, such as snow tires).

This may leave a few nervous drivers questioning: Should you rent a car in Iceland in winter? Absolutely! There’s no reason to miss out on our unique winter experiences, such as our winter wonderland scenery or ice cave exploration. You’ll just need to come prepared, empowered by knowledge, and behind the wheel of the right rental.

The “Off Season,” aka Our Shoulder Months (April, May, September, October, and November)

Our shoulder months will essentially give you semi-winter or semi-summer experiences, depending on the month you choose to visit, of course. So, if you’re planning on visiting during October, November, or April, you can already expect some wintery conditions. If you’re planning on visiting during May or September, you can expect some summery conditions.

You’ll obviously need to choose your rental according to these conditions. Also, just keep in mind that the F-roads in Iceland are only open during the warmer months of the year, so from mid-September to mid-June, you won’t be able to include the Highlands or certain areas of the Westfjords in your road trip itinerary.

Road Types: Main Roads, Gravel Roads, and F-Roads

Our roads come in threes:

Main Roads

These roads are paved and well-maintained. They remain open all year round and are accessible with a 2-wheel drive vehicle. These roads include the Golden Circle and the Ring Road (also known as Route 1), which essentially serves as the main highway, wrapping around the island in a circle.

Just keep an eye on road conditions in the northern parts of the Ring Road during the colder months of the year, as these areas can be particularly impacted by the weather.

Gravel Roads

We have different types of gravel roads. The ones that lead you to some of our most famous attractions are usually very well-kept. The ones through our less densely populated regions are a little less so.

So, while the former can be traversed using a 2-wheel drive and some caution, the latter should rather be tackled with a 4-wheel drive. Also, try to get a vehicle that offers more clearance, and remember to discuss Gravel Protection insurance coverage with your rental agent.

F-Roads

These are our wilderness VIP roads, exclusively for those who are adventurous at heart. Be ready for river crossings, steep climbs, and boulders that act like they own the road. These roads are only open in the summer due to their challenging conditions, and you are required by law to drive these roads with 4x4 vehicles.

Your Travel Style and Luggage Needs

Are you hitting the road solo with just a backpack or bringing your whole family with enough stuff to set up camp? You’ll need the right ride for your situation, so take note of the following:

• Group Size: Squeezing four adults plus bags into a tiny car is a recipe for a trip no one wants.
• Luggage: Ensure your chosen vehicle can accommodate all your belongings.
• Comfort: Road trips mean spending a lot of time in the car, so pick one you'll enjoy spending hours in.

Best Cars for Summer Travel in Iceland

Choosing the best car for traveling in Iceland during the summer is easy due to the pristine weather conditions. Here’s what you need to know:

A 2WD Car Will Do the Job

When deciding on the best car to rent in Iceland, a 2WD compact or economy car will do the job during summer if you plan on sticking to our city borders or tackling our main roads, such as the Ring Road, Golden Circle, and South Coast Way.

Even driving on our well-maintained gravel roads shouldn’t be much of a challenge. Additionally, opting for a smaller 2-wheel drive will be more budget-friendly and help protect our beautiful environment.

A compact 2WD car is ideal for couples, people traveling alone, and small groups who don't bring a lot of belongings. It's the perfect fit for those who want to see our top spots without going into the wild backcountry.

Budget-Friendly Small Car Options

The following are a few of the budget-friendly small car options we have here on the island and the top 2WD best cars for the Ring Road in Iceland:

• The Toyota Yaris, VW Polo, and Hyundai i20 are small cars that are suitable for both city driving and short journeys. They easily fit into cramped city parking spots and can navigate the winding, hilly roads along the coast with ease.
• The Kia Ceed and Toyota Corolla are cars that offer a bit more room for your bags while still helping you save on gas.

Pros:

• They cost less to rent and need less gas (leaving you more money for shopping in Laugavegur Street!).
• Parking is never an issue.
• They can easily navigate our narrow and winding roads.

Cons:

• Some compact cars can sit pretty low to the ground, requiring you to stick to paved roads only.
• They are not suitable for our F-roads or our more rough-and-tough roads in our more remote regions.
• The trunk is small (pack light!).

Quick Tip: Even in our "friendly" summer, the weather can surprise you. Always check the forecast on Vedur before heading out, and also double-check our road conditions via the Umferdin website.

Best Cars for Winter Travel in Iceland

Choosing the best car for traveling in Iceland in winter requires a bit more planning because of the harsher weather conditions. Here’s what you need to know:

Why a 4WD is Highly Recommended

Driving in Iceland in winter can be a challenge. Snow, ice, and strong winds mean you need a vehicle that can handle these types of conditions. We recommend 4WD vehicles for winter trips, even on our popular Ring Road. Here’s why:

• These cars, with all the necessary winter gear and accessories, can stick to our icy roads like white on rice.
• A 4-wheel drive can remain relatively stable when winds try to push it around.
• They manage snowdrifts well.
• These vehicles can traverse even the most challenging terrains.

Car Rental Options for Driving in the Winter

The following are a few of the hardy 4-wheel drive vehicle options we have here on the island:

• The Toyota RAV4 AWD, the Subaru Forester AWD, and the Land Rover Defender are spacious options for larger groups or families, or those who wish to pack everything and the kitchen sink for their trip to Iceland.
• The Dacia Duster 4x4 is a go-to if you're looking for a vehicle that’s tough as nails.

Pros

• 4x4 vehicles tend to be bigger, offering more space (whether for people or luggage).
• The bigger size also means more comfort for longer road trips.
• These vehicles can take on most challenges the road or weather conditions throw at them.

Cons

• These cars cost more, both in rent and gas.
• These cars are built to be practical and resilient, so don’t expect all sorts of luxury gadgets and gizmos like you would in a sleek city car.
• Due to their size, parking and maneuvering our narrow, winding roads can sometimes be a bit challenging.

Insider tip: Please ensure that your winter car rental includes all the necessary winter gear and accessories, such as studded tires.

What Vehicle Should You Rent for the Highlands?

As we have already touched on, most of the roads to explore the Highlands are our mountain roads, known as the F-roads. The conditions of these roads, as well as Iceland 4x4 rental laws, require that you exercise special care when choosing a vehicle to travel on them. Here’s what you need to know:

F-Road Requirements and Safety

Are you excited about exploring the Highlands? Here's the deal - you need one of our sturdy 4x4 SUVs, no questions asked (it’s the law!). Our F-roads (open from roughly mid- June to mid-September) are more like an adventure course than just another route “off the beaten path”.

Imagine crossing rivers, tackling steep hills, navigating obstacles on the road, and taking in breathtaking views that few get the privilege to see.

Just keep in mind that these 4x4 roads don’t mean you can DIY your own wilderness route along the way. Not only is it extremely dangerous, but we also have great respect for our environment, and driving off-road damages our delicate ecosystem.

As a responsible traveler, stick to our marked F roads. Never try to be a hero at river crossings if you're not sure. Either wait for another vehicle or turn back. Your safety is more important than any adventure!

F-Road Driving Tips

If this is your first time taking on the F-roads in Iceland, you’ll find the following tips helpful:

• Remember always to keep an eye on the weather forecast and to check road conditions before heading out.
• Let experienced individuals handle river crossings, and always check the depth and strength of the current before attempting to cross.
• Team up with another vehicle whenever possible (there’s safety in the buddy system).
• Pack like a Viking on a mission: bring lots of snacks, water, and a full tank. This way, you won’t need to worry about being left stranded without fuel somewhere along the way, and if you find yourself in a spot of trouble, you also won’t have to be concerned about thirst or hunger.

Recommended 4x4 Models for Highland Travel

When picking the best car to rent in Iceland for Highland trips, think about these reliable options:

• Toyota Land Cruiser: our top Highland pick. It has high ground clearance and sufficient power to navigate the challenging rivers.
• Jeep Wrangler: perfect for thrill-seekers.
• Dacia Duster 4x4: the budget option that will handle most off-road conditions relatively well (provided it doesn’t encounter deep water).
• Mitsubishi Pajero: a dependable option with space for all your trip gear.

Helpful hint: Consult with your rental agent about crossing rivers, especially if it will be your first time doing so. They will also be able to provide local insight into current river conditions.

Campervans vs Cars: Which is Better for Your Trip?

When it comes to road-tripping around the island, it can be tough choosing between a camper and a car. So, what will be the better fit for you? We give you a bit of guidance to help you with your decision-making.

The Pros and Cons of Renting a Campervan in Iceland

A campervan is the ultimate “buy 1, get everything else free” type of deal. They serve as transportation, a place to sleep, a kitchen, a lounge - all in one. Campervans are incredibly convenient and also add another element of uniqueness to your once-in-a-lifetime Icelandic adventure. Campervans come in 2-wheel drive as well as 4-wheel drive, so you’ll always find the right camper for your trip itinerary.

Pros:

• A camper brings flexibility to your trip.
• It’s a budget-friendly option, as it covers both transport and accommodation in one expense.
• You can camp in comfort.
• It’s the ultimate immersive experience, and you can look forward to stunning breakfast views of our natural wonders.

Cons:

• You’ll pay more for rental and fuel than you would for a compact, fuel-efficient rental car.
• Our legendary winds and other harsh weather conditions can make driving trickier.
• While a camper allows you to travel (and camp) even during the colder months of the year, you’ll definitely need to pack your thermals if you’re someone who gets a chill easily.

Car vs. Campervan Table

Below, we’ve included a quick-reference comparison table for your convenience:

Take into account that prices do vary according to the season and availability. Should you wish to explore camper options, you can do so at Campervan Iceland.

Fuel, Charging, and Car Pick-up Tips

We give some local insight and advice on these practical elements of your rental:

Gas Prices and Fuel Types

Get ready: our fuel prices might give you a shock – they can be double what you'd shell out in the US or Europe. As with most vehicles around the world, our cars work with either petrol or diesel. While you’ll find plenty of gas stations along our main roads in our cities and towns, they become scarcer the more you begin moving around remotely.

This is why you need to properly plan out your stops to ensure you don’t end up stranded next to the road. Gas prices also vary (even at the same gas station brands), so ask the locals where their go-to gas station is to save a few bucks. Also, ask your rental agent about their partnerships with local businesses for exclusive discounts.

The average fuel prices (as of July 2025):

• Petrol: +/- 314.35 ISK per liter (+/- $2.60/€2.21)
• Diesel: +/- 315.30 ISK per liter (+/- $2.60/€2.21)

Electric vehicles are also popular in Iceland, and the number of rental firms offering them is steadily increasing. As with gas stations, you’ll need to plan your charging points, especially since not all gas stations provide EV charging stations.

Helpful Hint: Many travelers are surprised when some of our remote stations accept credit cards with chip and PIN technology. So, spare yourself the hassle and ensure your credit card makes the grade before you arrive here on the island!

Where to Pick Up and Drop Off Your Rental

The following will help you navigate popular pick-up and drop-off spots:

Keflavik Airport

Keflavik is Iceland's largest international airport, and where most travelers will begin their journey to Iceland. Catch a shuttle to the rental agencies, located just a short distance away from the airport, to pick up your rental vehicle. Drop-offs will be at the exact location where you picked up the car, unless otherwise arranged with the rental agent.

Reykjavik City

This is yet another popular option for picking up a rental vehicle. Since this is usually the first stop after leaving Keflavik, many opt to catch the shuttle from the airport to the capital, where they then pick up their rental vehicle after exploring Reykjavik and are ready to head to the rest of the island. Drop-offs will be at the exact location where you picked up the car, unless otherwise arranged with the rental agent.

Tip: Always ensure that you’ve set aside enough time in your trip itinerary for pick-ups and drop-offs (remember, the paperwork – and chats! - can take some time).

Frequently Asked Questions About Renting a Car in Iceland

Below you will find the answers to some of our most frequently asked questions about renting a car in Iceland:

Should You Rent a Car in Iceland?

Absolutely! All our amazing attractions are scattered all across the island, and there are plenty of incredible remote regions you won’t be able to get to if you don’t have your own vehicle.

Should I Rent a Car in Iceland in Winter?

If you want to properly explore the island, you should rent a car in Iceland – even if it means winter driving in Iceland. Select a 4WD or AWD vehicle equipped with good winter tires, and don't forget to check local weather apps before embarking on your journey.

What are Icelandic Cars Like?

Our cars are pretty much the same as you’ll find anywhere else in the world. Rentals tend to be modern, well-kept, and ready for any challenge! We offer a range of options from zippy city cars to rugged 4x4s and snug campervans. Heated seats come as standard (you'll thank us for this later!).

Can I Drive on the F-roads with Any Car?

No way! The terrain is simply too rough for a little city car to handle, and our road laws require you to drive the F-roads with a 4x4.

Are the Vehicles in Iceland Manual or Automatic?

We have both, but automatics are like our hot springs - in high demand!

Do I Need Special Insurance?

Certain types of insurance, such as TPL (Third Party Liability), are mandatory in Iceland and are usually included in your rental price. However, we suggest you have a chat with your rental agent to discuss your trip itinerary and any other insurance coverage you may need, such as Gravel, Sand, and Ash Insurance. Here's a quick guide for any Reykjavik car rental:

What About Wind Damage?

Our winds are definitely no joke, especially during our colder months! So, keep a tight grip on those doors when opening or closing them. Otherwise, you may have to submit an insurance claim.

What is the Minimum Age Requirement to Rent a Car?

The majority of smaller rental firms in the county require clients to be at least 20 years old to drive their standard cars and 23-25 years old to drive their hardcore 4x4s and adventure rides. You must bring a valid driver's license (in English) or obtain an international driver’s permit.

Can I Use My Driver's License from My Home Country?

You bet! As long as it is written in English. If not, you’ll need to obtain an international driver’s permit, although obtaining one before arrival provides some extra protection.

What About a Security Deposit?

Most car rental companies in Iceland require a security deposit, which is a hold on your credit card. The amount can change based on the car type and insurance you pick.

Final Tips: Book Early, Drive Safe, and Enjoy the Journey

Here are our final words of wisdom:

• Book early during our peak season: In Iceland, available car rentals can be scarcer than daylight in December!
• Drive safe: Watch those speed limits, be nice at single-lane bridges, and stay on marked roads.
• Check road conditions: Remember to keep Vedur and Umferdin close - they're your go-to source here!
• Pack food and drinks: You might not see many gas stations in the more remote areas, and believe us, you'll be glad you brought some extra rations for emergencies.
• Talk to us: We're locals with decades in the rental industry. We know our vehicles and the area, and want to help you have a fantastic trip!
• Check out what others say about their rental car experience. Learn from other travelers to pick the right car for you.

Time to Get Your Rental and Hit the Road!

Iceland offers a wide range of car rental options that cater to every type of traveler, itinerary, or holiday budget. So, are you ready to take the road trip of a lifetime?

Then pick the best car to rent in Iceland for your specific needs, requirements, and preferences, click that booking button to rent your car in Iceland well ahead of time to avoid disappointment, and begin to look forward to an unforgettable time here in the Land of Fire and Ice!