Driving in Iceland is an absolute pleasure. Renting a car gives you the chance to go where you want, at your own pace; plus, long-distance buses and tours can be expensive, so a self-drive itinerary is the best way to travel on a budget.
Nevertheless, driving in a different country can be daunting, so plan thoroughly and make sure you’re as prepared as you can be with our ultimate guide to driving in Iceland.
What type of car is right for you?
The type of vehicle you need really depends on where you want to go. If you don’t plan to venture far from Reykjavík, and you’re traveling during the summer months, hiring a city car with two-wheel drive will be just fine.
The Hyundai i10 and the Toyota Yaris are both great options if you are on a small budget, and the same can be said about the Renault Trafic if you are traveling with a large group.
On the other hand, if you intend to travel into the highlands or down any off-the-beaten-track gravel roads in parts of Iceland such as the Westfjords, you’ll benefit from renting a 4x4.
Hiring a Dacia Duster is a great option if you are worried about the cost of your rental. Other 4x4 models we can recommend include the Suzuki Jimny, one of the best crossovers on the market, and the Land Rover Defender, perfect if you need extra space for your friends and their bags.
What are the main driving rules in Iceland?
Most important (especially for British visitors) is that Iceland drives on the right. That’s obvious, of course, in areas where there’s traffic, but easy to forget momentarily if you’re in a remote rural area and there’s nothing on the road.
Cars are therefore left-hand drive, so a European or American driving in Iceland will feel right at home.
Other driving rules in Iceland include:
- Seatbelts are compulsory for the driver and all passengers
- Speed limits are strictly enforced
- It’s forbidden to drive off-road
- Don’t drink and drive
- Headlights and taillights must be turned on day and night, all year round
- You must never use a mobile phone while driving
Common hazards experienced when driving in Iceland
- Single lane bridges
As you approach a one-lane bridge, you must slow down to 50 km/hr. Start checking for oncoming traffic well before you reach it, particularly if it’s also signaled as a blind hill. If the road is clear, you can proceed with caution. If you’re in any doubt as to who has priority, give way to the other driver, so you don’t end up having to reverse.
- Animals on the road
It’s a common occurrence for animals to stray onto the road in Iceland, therefore hazardous road areas will usually be signposted. So long as you have allowed plenty of stopping distance, waiting for sheep to pass will be one of the pleasures of venturing out into the Icelandic countryside.
- Rapidly changing weather conditions
Even in summer, Icelandic weather can change rapidly. One minute, the sky is blue; the next, visibility has shrunk and you can’t see what’s ahead of you on the road. Check the forecast regularly and be prepared to slow down if the weather turns inclement. If you reach a sign that says “Lokað”, it means closed and you should not ignore the warning.
- Slippery surfaces
Road surfaces can quickly turn slick or slippery. Brake slowly if this is the case and ensure you have as much traction as possible. If you do begin to skid, don’t be tempted to slam on the brakes. Instead, increase pressure slowly while turning the wheel in the direction the car is sliding.
- Gusty winds
Strong winds also create a hazard for drivers. At the side of the road, you’ll often see signs indicating wind speeds, for instance on a mountain pass. If these are shown in red (20 m/s or more), take the warning seriously and slow down. Take care when opening the car door, as fierce winds can easily damage your rental vehicle.
What kind of license do I need?
If you’re traveling to Iceland from the EU, EEA or the UK, your own driving license will be sufficient. The same is true if you’re planning on driving in Iceland with a US license, or one issued in Canada or Australia. Tourists coming for up to 30 days don’t generally need an International Driving Permit.
Note that you will require an IDP for Iceland if your driving license isn’t in Latin script and doesn’t bear a license number, valid date or the license holder’s photograph. If you are from outside the EU or EEA and arrive with your own car on the ferry, you’ll need a Green Card to be able to prove you have third-party insurance.
What types of roads can I expect?
Iceland’s road network is extensive, particularly in summer. In spring, autumn and winter, the interior roads close because of heavy snowfalls, as do some remote routes outside of the highlands.
You can keep abreast of current road conditions and check what’s open by visiting the website of the Icelandic Road and Coastal Administration – the information you’ll find is updated regularly and it is helpfully accurate.
- Urban roads
Driving in Reykjavík is pretty straightforward. If you’re used to driving in heavily populated areas with bumper-to-bumper traffic, this is going to be a piece of cake. Roads are clearly signposted and drivers are disciplined.
Junctions feature either traffic lights or roundabouts, enabling traffic to flow smoothly and everyone to get a turn. If you need more information on how to deal with them, here's our guide to roundabouts in Iceland.
In the city center the speed limit oscillates between 30 km/h and 50 km/h. Some streets are relatively narrow, although on the outskirts there are numerous dual carriageways, which enable traffic to move unencumbered and will help you get out of town and be on your way in a jiffy.
- Countryside roads
When you read about travelers circumnavigating Iceland’s Ring Road it mainly entails driving through the Icelandic countryside. Much of the road is a single carriageway route but on well-maintained asphalt. Traffic is often light, especially the further you go from Reykjavík and the touristy South Coast. Typically, the speed limit is 90 km/h.
Speed limits due to Iceland’s rapidly changing weather and the animals that have a tendency to wander out into the road from unfenced grazing land.
In spring, be particularly aware of lambs that have become separated from ewes, as they may dash out in front of your vehicle unexpectedly.
- Gravel roads
If you turn off the Ring Road there’s a good chance you will find yourself on gravel. Drop your speed – not only is it the law (the limit is 80 km/h on gravel roads), but if you’re unused to driving on these roads you’ll be surprised by the increased stopping distance.
It’s also worth considering adding an extra cover to your insurance in case of any stone chips. Unless you’re on a road with a particularly steep gradient or where it’s especially icy or slick from a rain shower, these roads shouldn’t pose a problem for you. However, be especially careful where the road switches from asphalt to gravel.
You should brake gradually as you approach the gravel stretch so that you don’t lose traction, as many accidents occur at these spots. Always make sure your speed is appropriate for the condition of the road.
Iceland’s mountainous interior is off-limits throughout the winter months. It’s crisscrossed by F-roads, but in winter they are impassable in bad weather and often blocked by heavy snowfalls. Come late June (or even July if routes are especially muddy or boggy), these notorious roads become accessible with a 4WD for the short summer period.
In any case, you’ll appreciate having a 4x4 and for the most challenging parts of the F-road network, plus a high clearance vehicle is compulsory in most cases. In places, you’ll have to ford streams and tackle some heavily potholed terrain, so driving on F-roads isn’t for everyone. If you’re daunted by such driving, take a tour instead.
Beyond the Ring Road: four great driving routes in Iceland
For many visitors to Iceland, the idea of driving around Iceland on its famous Ring Road is a tempting one. But there’s no need to loop the entire country to pull off a memorable and scenic Icelandic road trip. Try these great driving routes as well:
1. The Golden Circle
Length: 300 km (186 miles)
Duration: 1-2 days
Best time: All year round
This iconic route has become almost a rite of passage for those driving in Iceland for the first time. The Golden Circle connects three of the country’s most famous tourist destinations. Furthest from Reykjavík is Gullfoss, a powerful waterfall that pours over a cleft in the rock along the Hvítá River. It’s a dramatic sight, no matter what time of year you visit.
Just down the road from Gullfoss you’ll find Haukadalur Geothermal Field. This geothermal area is filled with visitors who come to see Strokkur Geyser erupt, which it does frequently, sending boiling water and steam high into the air every few minutes.
Completing the trio of attractions is Thingvellir National Park. It’s here where you’ll find the site of the Althing, Iceland’s first parliament, as well as a fabulous gorge and a cute little waterfall called Öxarárfoss.
2. The Diamond Circle
Length: 310 km (190 miles)
Duration: 2-3 days
Best time: All year round
North Iceland’s answer to the Golden Circle is the Diamond Circle. Because it’s further from Reykjavík, fewer travelers drive this scenic loop, but those who do are glad they added it to their itinerary. Both Akureyri and Húsavík make convenient bases for drivers wishing to follow the Diamond Circle; Húsavík is actually one of its highlighted stops.
Two magnificent waterfalls can be found on the Diamond Circle route; Dettifoss has the largest volume of water of any in Iceland. There’s a walkway alongside it, making it easy to get close enough to feel the spray. Goðafoss is visible from the Ring Road but well worth stretching your legs for.
Also, on the Diamond Circle route are Mývatn, where you’ll find geothermal baths, Dimmuborgir, known for its dark rock formations, and the breathtaking, horseshoe-shaped Ásbyrgi Canyon.
3. The Arctic Coast Way
Length: 900 km (560 miles)
Duration: 3-12 days
Best time: Late spring to early autumn
If you’re keen to drive the entire length of the Arctic Coast Way, then make this a summer trip as parts of the route close during the winter if there have been heavy snowfalls. This extraordinary journey takes in North Iceland’s jaw-dropping beauty, from Hvammstangi in the west to Bakkafjörður in the east.
The Arctic Coast Way boasts an astonishing variety of landscapes and settlements. Highlights include the northerly town of Siglufjordur, once Iceland’s herring capital, and the chance to learn about Norse mythology at Arctic Henge. Along the way, there are opportunities for whale watching, horse riding, hikes to nature reserves, seal boat trips and diving tours.
4. The Westfjords Way
Length: 950 km (590 miles)
Duration: 3-7 days
Best time: Summertime
When the long-awaited Dýrafjarðargöng tunnel opened in October 2020, it connected the northern Westfjords to the southern part, creating the Westfjords Way.
For the first time, it was possible to travel between both areas throughout the whole year – previously in bad weather, the road was impassable. Most of the route is paved, but you’ll need to drive on gravel to complete the whole loop.
The Westfjords Way is well off the beaten track, so if you’re keen to drive on empty roads and blaze a trail to some of Iceland’s most remote places, this is the route for you.
Essential stops include Dynjandi Waterfall, Ísafjörður (from where you can take a boat to Hornstrandir Nature Reserve), Látrabjarg Sea Cliffs, which teem with birds in the summer, Iceland’s oldest bookstore in Flateyri and the quirky Museum of Icelandic Sorcery and Witchcraft in Holmavik.
If you don’t have a lot of time, you can get a taste of Iceland’s breathtaking landscapes and charming towns by driving along its fabulous South Coast. The beautiful Snæfellsnes peninsula or wild Reykjanes are also worthy detours worth checking out on your way to or from the airport.
Wherever you choose to go, your road trip adventure starts when you get your rental car in Reykjavik and go wherever your imagination takes you!