Driving in Iceland in July: What to Know Before You Hit the Road

By Johanna Sigurðardóttir Verified Expert

Driving in Iceland in July is freedom with an engine. The buses roll out packed, windows fogging, every stop timed to the minute. You can join that parade or rent your own car and decide when to stop, when to keep moving, and when to follow a road just because it looks good. Peak season brings crowds, but also the easiest driving this country offers. In this guide, we’ll cover the real questions: which car to rent, what insurance matters, how to handle Iceland’s road rules, and where to drive when the daylight refuses to quit.

Is July a Good Month to Drive in Iceland?

For anyone weighing when to rent a car here, July is the clear yes. An Icelandic road trip in July is easier, safer, and more forgiving than most other months. Think of it as the season where the country lowers the difficulty setting.

• Winter vs July - In January, you fight snow drifts and ice sheets. In July, you fight… traffic jams near waterfalls. Pick your battle.
• Spring and Autumn vs July - Shoulder months tease with cheaper rentals, but still risk sudden storms. July trades the chaos for predictability.
• First-time drivers - July feels like Iceland on training wheels. Roads stay open, conditions stay manageable, and mistakes rarely punish.
• Trade-offs - Higher rental costs and crowded hotspots. But you gain peace of mind behind the wheel.

Weather and Road Conditions in July

Every road trip lives or dies on two things: the sky above and the surface under your tires. July in Iceland sets the backdrop. From here, we break down how the season shapes the drive, from steady road conditions to the strange rhythm of near-endless daylight.

What Makes July Ideal for a Road Trip

A road trip in Iceland in July comes with practical advantages that shape how you drive and pack. Here’s how:

• Temperatures - Average daytime highs rest around 10°C-15°C (50°F-59°F). Some days climb higher, but Icelandic weather can flip quickly from sun to drizzle.
• Tires - Winter gear is unnecessary. Ice is almost absent, so you drive without worrying about frozen surfaces.
• Confidence behind the wheel - Predictable conditions help even cautious visitors stay relaxed.
• Road mix - The Ring Road stays mostly dry and steady. Once you leave it, gravel tracks remain common, demanding slower speeds and more attention.
• Packing - The milder climate reduces the need for bulky clothing. A rain jacket and layers do the job, leaving bags lighter and preparation simpler.

Daylight Hours and the Midnight Sun Effect

Driving in Iceland in July means adapting to a rhythm where daylight has quite a big influence on your plans. Think of it like this:

• Daylight - Expect 18 to over 20 hours of light each day. Even in Reykjavík, night feels more like a drawn-out dusk. Head north, and the dim never really comes.
• Midnight sun - The midnight sun dips low, but the sky glows on, giving the impression of one long day that refuses to end.
• Flexibility - More hours on the clock let you stretch routes, stop whenever curiosity strikes, and drive without a deadline.
• Safety - Reduced night driving means fewer risks tied to darkness. Roads stay visible almost around the clock.
• Fatigue - The challenge isn’t dark roads but your own limits. Endless daylight can trick you into pushing too far without rest.

Renting a Car in Iceland in July

First decision: rent a car in Iceland or spend your trip trapped on a bus. July gives you everything from pocket-sized hatchbacks to SUVs with room for the whole crew. The season isn’t the real factor here. 

What matters is where you plan to drive, how many people you’re hauling, and how much comfort you need to stay sane.

Next, we’ll cut to the chase: which cars actually work, when a 4x4 is worth the upgrade, and what insurance saves you from nasty surprises at the counter.

Best Type of Car for July Travel

Not sure which car to choose in Iceland? The trick is matching the car to your trip, not your Instagram feed. Here’s how it breaks down:

• For Paved Roads & Budget Travel - Hyundai i10, Toyota Aygo, Kia Rio. Small, cheap to run at about 5-6 liters per 100 km (39-47 mpg), and perfect for the Ring Road or Golden Circle. Great for two people with light bags. Just don’t expect miracles when it comes to trunk space.
• For Comfort & Everyday Flexibility - Toyota Yaris, Kia Ceed, Skoda Octavia Sedan. More luggage room, smoother ride, and less cramped on long drives. Ideal for small families or couples planning more than quick day trips.
• For Space & Groups - Opel Crossland X or Renault Trafic vans. Enough seats and storage to keep kids, gear, and everyone’s temper in one vehicle.

Note: standard cars are not permitted on F-roads. That’s where 4x4s come in. More on that next.

At-a-Glance: Which Car Fits Your Trip?

Is a 4x4 Necessary in Summer?

Not every traveler needs a 4x4. The Ring Road and Golden Circle are fully paved or maintained with gravel, and a standard 2WD is more than enough in July. If your plan sticks to these routes, a smaller car stays comfortable, fuel-efficient, and cheaper to rent.

The story changes when you head for Iceland’s F-roads in July. These highland tracks are rough, unpaved, and often cut across steep inclines or shallow rivers. The law makes it clear: only 4x4s are permitted. Take a 2WD and you risk heavy fines, void insurance, and probably a tow bill.

A proper 4x4 brings the traction and clearance needed to handle volcanic gravel, ruts, and water crossings. Models like the Dacia Duster, Suzuki Vitara, or Jeep Renegade are built for this terrain. Even then, F-roads demand caution. They are best suited for confident drivers who know how to handle remote, uneven ground.

Insurance Tips for Summer Rentals

Sorting out car rental insurance in Iceland isn’t fun, but skipping it can get expensive fast. Here is what matters for July:

• Base coverage - Every rental comes with Collision Damage Waiver (CDW) and third-party liability. CDW limits what you pay if the car is damaged. Third-party covers injuries or property damage caused to others.
• Gravel Protection - A must for summer. Loose stones on rural roads chip paint and crack windshields. Repairs often cost more than the insurance upgrade.
• Sand & Ash Protection - Conditions can turn dry and windy. Volcanic ash and sandstorms scratch paint and glass. This coverage makes sense if you head to exposed regions.
• Overlap check - Look at your travel policy before paying. Some already include car rental insurance, so avoid doubling up.
• Rental terms - Deductibles vary. Read the fine print to know what is excluded, especially for gravel or volcanic damage.

What Each Insurance Actually Covers

Essential Driving Tips for July

Getting the car was the easy part. Now you need to play by Iceland’s rules. Speed limits feel slow, bridges shrink to one lane, and sheep wander like they own the road. Gas stations? Sometimes hours apart. Miss one and you’ll regret it. Know the basics before you turn the key.

Understanding Iceland’s Road Rules

Driving laws in Iceland are strict, and breaking them gets expensive. Here’s what to know:

Basics

• Drive on the right-hand side and keep headlights on at all times.
• Seat belts are mandatory for everyone.
• Mobile phones are only allowed with hands-free devices.
• Alcohol limit is 0.05% BAC. Treat it as zero.
• Off-road driving is flat-out illegal.
• Headlights should be on 24/7.

Speed & Fines

• Limits - 50 km/h (31 mph) in towns, 90 km/h (56 mph) on paved rural roads, 80 km/h (50 mph) on gravel.
• Fines sting - 23,544 ISK ($175) for small overages, up to $600 for major speeding.
• Other violations like phone use or failing to yield can cost 40,000 ISK ($275).

Unique Hazards

• One-lane bridges: closest car goes first.
• Sheep crossings: slow down, expect surprises.
• Roundabouts: inner lane has priority when exiting.
• Traffic cameras are everywhere and automatic.

Navigation and Fueling Up

Finding your way around Iceland isn’t hard if you know what to expect. We offer GPS and portable Wi-Fi add-ons for a small fee. Portable 4G Wi-Fi units connect several devices and work fine in towns or along the Ring Road, but coverage drops in the Highlands. 

GPS rentals give you turn-by-turn directions and display Icelandic place names, so you avoid wrong turns on unfamiliar routes. Gas stations in Iceland are easy to find along the Ring Road and in most towns. In remote areas, the story changes. 

Some stretches run 100–150 km (62–93 miles) without a single pump. Highland stations exist, but they are rare and usually more expensive. Fuel prices run about 250-300 ISK per liter ( $6.50-7.80 USD per gallon), making Iceland one of the priciest in Europe. To cut hassle, we offer free fuel discount cards so you save money and skip last-minute refills.

Websites to Check Before You Drive

Good Iceland driving tips for summer start with knowing where to look before you even start the engine. These sites keep you out of trouble and save you from nasty surprises:

• Vedur.is - Iceland’s official weather site. Gives real-time forecasts on temperature, wind, rain, and storm warnings. Essential when conditions shift in minutes.
• Umferdin.is - The authority on road conditions and closures. Check F-road accessibility, see live traffic cameras, and track weather by region. Perfect for planning Highland trips.
• SafeTravel.is - A one-stop shop for alerts, safety advice, and trip planning. You can even leave your travel plan with them, so someone knows where you are in case of an emergency.

Check these sites daily. Icelandic weather does not care about your itinerary. Plans that looked safe at breakfast can turn risky by the afternoon.

Where to Drive in Iceland in July

Not every road is equal. Some hand you waterfalls without effort, others test you with river crossings. July is when every option is open, so the question shifts to you: Do I stick with the Ring Road for the classics? Push into the Highlands for the wild stuff? Or take the quiet detour where the buses never go? Here are a few routes to help you decide what kind of self-drive in Iceland in July you actually want.

The Ring Road: A Classic Summer Route

Driving in Iceland in July often means tackling the Ring Road. Route 1 runs 1,322 km (822 mi) around the island. Mostly paved, with a few gravel stretches. Any 2WD can handle it.

The pull is in the stops:

• Seljalandsfoss - A waterfall you walk behind, spray in your face, everyone soaked and grinning.
• JökulsárlónGlacier Lagoon - A lagoon full of icebergs drifting out to sea. Seals pop up like it’s nothing.
• Lake Mývatn - Volcanic craters, hot mud bubbling, steam vents hissing, and clouds of midges reminding you it’s alive.
• Vík and Dyrhólaey - Black sand stretching forever, cliffs packed with puffins, waves pounding hard enough to make you step back.
• Vatnajökull - Europe’s largest glacier, tongues of ice pushing right down to the road.
• Eastfjords - Remote fishing villages and winding fjords where the crowds finally disappear.

Take 7 to 10 days if you want to see it properly. Any faster and you’re just chasing white lines on the asphalt.

Highlands and F-Roads: Are They Open in July?

An Icelandic road trip in July is the best chance to see the Highlands. These are the remote, empty middle of the country, reachable only on F-roads. They open in mid to late June and shut again by early September, depending on snow melt. July is peak season for them: warmer days, long light, and fewer closures.

Routes worth noting for Iceland’s F-roads in July:

• F208 Landmannalaugar - The Highlands’ showpiece. Rhyolite mountains painted in red, yellow, and green. Hot springs to soak in after hiking. Sigöldugljúfur Canyon, where turquoise water cuts through black rock. Ljòtipollur Crater, an ugly name hiding a surreal volcanic lake. The northern stretch is more forgiving, which is why you’ll see plenty of rentals tackling it.
• F225 Landmannaleið - A shortcut into Fjallabak Nature Reserve. It looks tame at first, then throws in several river crossings. Not for nervous drivers.
• F35 Kjölur - A straight shot across the Highlands from Gullfoss to the north. No river fords, so it’s one of the easier F-roads. Hveravellir geothermal area is the payoff: bubbling pools and steam vents in the middle of nowhere.
• F26 Sprengisandur - The endless one. The longest, loneliest F-road. Black desert, glaciers on the horizon, and nothing else. You need fuel, food, and patience.
• F88 Askja - Rocks, rivers, rough ground. Leads to the Askja Caldera, where astronauts once trained for the moon. Worth it, but only if you know how to handle water crossings.
• F210 Fjallabaksleið Syðri- A tougher parallel to F208. Deep rivers and raw landscape near Landmannalaugar. You’ll earn every kilometer

Hidden Gems Off the Beaten Track in Iceland

A self-drive in Iceland in July means you are not stuck with the same waterfalls as everyone else. These are the places that take more effort but reward you with space, silence, and stories the tour groups miss.

• Viknaslóðir Hiking Trails (Eastfjords) - Remote routes across fjords and valleys, alive with seabirds and reindeer. Rugged, quiet, and best for hikers who want wilderness without a crowd.
• Hornstrandir Nature Reserve (Westfjords) - No roads lead here. Access is by boat or a long hike. Arctic foxes roam freely, cliffs rise out of the sea, and you’ll lose phone signal fast. That’s the point.
• Grótta Nature Reserve (Reykjavík) - A lighthouse you can walk to at low tide, with birdwatching and a small hot pool. Locals slip out here for sunsets, and in winter, it’s a northern lights spot right by the city.
• Þakgil Campground (near Vík) - A canyon tucked away from the South Coast crowds. Hiking paths wrap the valley, and a cave serves as the dining hall. The road passes an abandoned film set, adding a surreal touch.
• Siglufjörður Village (North) - Once the herring capital, now a small town surrounded by sharp mountains and fjords. The Herring Era Museum tells the story of boom and collapse. Feels more real than the tourist-heavy towns further south.
• Seltún Geothermal Area (Reykjanes) - Mud pots boiling, steam vents hissing, and mineral-stained ground in red and yellow. Overlooked by travelers racing to the Blue Lagoon, which makes it better.
• Hellissandur (Snæfellsnes) - A fishing village turned canvas. Murals splash across old houses and sheds, bringing color to the lava fields. A mix of tradition and street art in the shadow of Snæfellsjökull.
• Landeyjahöfn Black Sand Beach (South) - A stretch of coast with fewer footprints. Wildlife is the main company: seals hauled out on the sand, seabirds overhead.
• Þórsmörk Valley (Highlands) - Wedged between glaciers with trails into canyons and caves. Waterfalls tucked away from the main paths. You reach it on foot or with a guided 4x4, which is why it stays quiet.

What to Pack for a July Road Trip

Packing for Iceland in July isn’t just throwing a few shirts in a bag. Bring the right gear and you’ll spend the trip exploring instead of scrambling for what you forgot. Here’s what we suggest you bring with you:

Clothing Essentials

Driving and Camping Gear

July Driving FAQ

Can I See the Northern Lights in July?

No. The sky never gets dark enough. If northern lights are the goal, plan your trip between September and April. July is for midnight sun, not auroras.

Are All Roads Open in Iceland in July?

Most paved roads are open and easy to drive. F-roads in the Highlands depend on snow melt. Check daily updates on Umferdin.is before you gamble on a detour.

How Safe Is It to Drive Alone?

Driving alone in July is generally safe. Main risks are fatigue from endless daylight and sliding on gravel. Leave your route with SafeTravel before heading into the Highlands.

Is it Safe to Drive in Iceland in July?

Yes. Compared to winter, July is the easy season. Roads are clear of ice, visibility is long, and hazards are minimal. Just don’t underestimate sudden weather changes.

Final Tips for Renting and Driving in Iceland

Self-driving in Iceland in July is what most of our customers come for, and the trick is getting it right before the keys hit your hand.

• Book early - July is peak. Our Hyundai i10s, Kia Rios, and Dacia Dusters vanish fast. Reserve ahead so you get the car you want, not what is left.
• Check what’s included - With us, you always get Collision Damage Waiver, unlimited mileage, and VAT upfront. Extras like Gravel Protection or Sand & Ash are optional, not hidden surprises.
• Inspect on pickup - We encourage it. Walk around, note scratches, windshield chips. We document everything with you.
• Use the light - Start early to skip the buses. Or drive late under the midnight sun and have the roads to yourself.
• Fuel smart - Our free fuel discount card gives you reduced prices at Orkan and Olís stations. Some locations even throw in free coffee or WiFi, which makes long stretches easier.

Driving in Iceland in July Starts Here. Secure Your Car Today

Driving in Iceland in July is not about ticking sights off a list. It is about time. Time to stop in small towns, to walk out onto black sand, to take that side road just because. July gives you daylight and open roads. 

All you need is the right car. Our massive fleet covers everything from compact city cars to Highland-ready 4x4s. 

Choose what fits your trip, not someone else’s idea of it. Book today and let driving in Iceland in July become the best decision you've made before stepping off the plane.