Iceland is a breathtaking, bucket-list destination where dramatic landscapes steal the show. From volcanic fields and thundering waterfalls to icy glaciers and misty fjords, every corner of this Nordic island feels like nature’s masterpiece. Whether you’re circling the ring road for the first time or revisiting favorite hidden gems, the country never fails to inspire awe. After a day of exploring, you’ll need the perfect retreat—and that’s where the best hotels in Iceland shine.
These stays range from cozy cliffside hideaways to sleek Scandinavian lodges, offering the perfect balance of comfort and design. Whether you’re warming up under northern lights or soaking in a geothermal pool, the best hotels in Iceland promise more than just shelter—they offer an unforgettable experience. Trade your hiking boots for luxury and prepare to unwind in true Icelandic style.
1. Highland Base
If you thought Iceland was just about fiery eruptions and freezing temperatures, think again. Highland Base is the best hotels in Iceland for anyone who wants to feel like they’re on another planet—literally. When The Retreat at Blue Lagoon had to temporarily close due to the recent volcanic excitement on the Reykjanes Peninsula, Highland Base was ready to take the spotlight. Located 110 miles and a universe away from Reykjavik, this off-grid retreat is where adventure meets luxury, in a place that’s been snow-covered and barely touched since the 1930s.
Getting to this slice of extraterrestrial heaven isn’t a breeze. After a scenic 90-minute jaunt on the Golden Circle to Skjol Basecamp, you’ll embark on a thrilling, snow-drifting escapade in Super Jeeps. The Highland Base itself resembles a minimalist Nordic space station, complete with 28 sleek rooms and six pod-like lodges. These lodges, crafted from sustainable wood and concrete by the geniuses at Basalt Architects (the same folks behind the Blue Lagoon), feature sunken living rooms and panoramic windows straight out of a sci-fi flick. And if you’re feeling nostalgic, there are also A-frame huts from a 1960s ski school where you can sleep like an Arctic adventurer.
Once you’ve thawed out from your frosty journey, dive into cross-country skiing, snowshoeing, or simply lounging in geothermal baths under the Northern Lights. After a day of Arctic char and Brennivín schnapps, you’ll know why this is one of the best hotels in Iceland. Trust us, this is not just a stay; it’s an interstellar experience!
2. Reykjavik Edition
If you thought Reykjavik had style nailed down, the Reykjavik Edition just turned the fashion dial up to eleven. This freshest addition to the best hotels in Iceland scene is like Reykjavik’s answer to a chic Manhattan loft, Barcelona’s stylish flair, or Tokyo’s cutting-edge cool—all with a cozy Icelandic twist. Designed by the iconic Ian Schrager and Marriott, this gem of a hotel places Reykjavik firmly in the league of global trendsetters.
The Reykjavik Edition doesn’t just follow the best hotels in Iceland blueprint; it reinvents it with a splash of Nordic pizzazz. Picture sleek interiors that blend basalt, lava, warm oak, and concrete—basically, Reykjavik’s vibe in décor form. Rooms? Oh, they’re not just rooms; they’re your personal art galleries with floor-to-ceiling windows showcasing either the stunning fjord and Mt. Esja or the vibrant downtown Reykjavik scene.
Perfectly perched between the Harpa Concert Hall and Reykjavik’s Old Harbour, the Reykjavik Edition’s location is as unbeatable as its amenities. Think rooftop terrace views of the northern lights, a restaurant helmed by Iceland’s first Michelin Star chef Gunnar Karl Gíslason, and a speakeasy-style bar that’s basically the epitome of cool.
3. Hotel Rangá
Welcome to Hotel Rangá, where the best hotels in Iceland meet a touch of taxidermy drama! Upon arrival, you’ll be greeted by Hrammur, a 10-foot-tall polar bear who took a detour from Greenland and washed ashore. He might be stuffed, but he sets the stage for a stay that’s anything but ordinary. Nestled on Iceland’s south coast, this place is the perfect blend of luxury hunting lodge and quirky country manor.
Picture this: a log cabin retreat that feels like a cozy Icelandic summer house, with twin glaciers Eyjafjallajökull and Mýrdalsjökull peeking in like they’re eager to join your adventure. After a day of snowmobiling on the glacier or embarking on a super jeep tour through the enigmatic Thórsmörk Nature Reserve, Hotel Rangá offers a warm embrace. The rooms exude a homely charm with local art and Icelandic quilts, making you feel right at home.
But wait, there’s more! This is one of the best hotels in Iceland with seven luxurious suites, each dedicated to one of the seven continents. As if that wasn’t enough, unwind in the hot pot under the starry sky or head to the observatory. With a local astronomer and northern lights photographer to guide you, you’ll capture the aurora borealis in all its glory. When it comes to the best hotels in Iceland, Hotel Rangá is where adventurous spirits and cozy comfort collide!
4. The Retreat at Blue Lagoon
Ah, the Blue Lagoon: Iceland’s glittering gem where tourists either flock like moths to a flame or steer clear like it’s a hot potato. But when it comes to the best hotels in Iceland, The Retreat at Blue Lagoon is in a league of its own. It’s not just an accommodation; it’s an experience so opulent it might make you forget that there’s a lava field just outside your door.
So why is The Retreat the crème de la crème among the best hotels in Iceland? For starters, it’s got the geothermal magic of the Blue Lagoon infused into its very soul. This hotel boasts sleek, minimalist suites that reflect the mossy, lava-covered landscape outside. With floor-to-ceiling windows, you’ll bask in the ethereal glow of the Reykjanes Peninsula, transforming your room into a canvas of Icelandic elegance.
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But let’s talk spa—because why wouldn’t we? At this upscale haven, the underground spa is practically a fantasy land, offering the exclusive Blue Lagoon Ritual. This wellness extravaganza involves a rejuvenating cleanse using the lagoon’s silica, algae, and minerals, all while you sip your way through sheer bliss. And as if that’s not enough, you’ll get VIP access to a more exclusive section of the Blue Lagoon and enjoy gourmet delights at a world-class restaurant.
5. Deplar Farm
Looking to escape the ring road and dive into Iceland’s remote, jaw-dropping wilderness? Welcome to Tröllaskagi Peninsula, where the rugged mountains meet the Northern Atlantic Ocean in a dramatic dance of nature. Amidst this epic scenery lies Deplar Farm, one of the best hotels in Iceland for anyone yearning to blend isolation with luxury. Hidden in a grassy meadow and flanked by towering peaks, this turf-covered farmhouse might look unassuming, but it’s a hidden gem of the highest order.
Deplar Farm, part of the exclusive Eleven Experience collection, is not your average mountain retreat. It’s the best hotels in Iceland for those who crave adventure without sacrificing a touch of elegance. In winter, get your adrenaline pumping with heli-skiing or cozy up for some gourmet hot chocolate. When the snow melts, swap your skis for mountain bikes or cast your line for some top-notch salmon fishing.
And when you finally return from your exploits, you’ll be greeted with world-class cuisine whipped up by Iceland’s finest chefs. Want to unwind? Dive into the heated pool with a swim-up bar and toast to your latest adventure. With stylish rooms overlooking the serene meadow, Deplar Farm is definitely one of the best hotels in Iceland to kick back, relax, and pretend you’re royalty in the wild. Whether you’re scaling peaks or soaking in luxury, this place is the pinnacle of Icelandic indulgence!
6. Hotel Egilsen
If you think Iceland’s most picturesque town is just a postcard, think again. Welcome to Stykkishólmur on the Snæfellsnes Peninsula, where colorful antique houses, a shimmering harbor, and snow-capped mountains create a scene straight out of a fairy tale. Once the bustling hub of Scandinavian trade from the 17th to 19th centuries, this town’s charm is as timeless as its history.
Enter Hotel Egilsen, the best hotels in Iceland for a dose of nostalgia mixed with Nordic flair. Housed in a vibrant red 1867 home—once the pride of a wealthy Icelandic merchant—this boutique gem is a cozy, charming retreat. With its mismatched antique furnishings and rooms inspired by the sea and fishing (think nautical chic), Hotel Egilsen embraces its historical roots with a warm hug.
But this isn’t just any old hotel; it’s a literary haven too! The best hotels in Iceland wouldn’t be complete without a library stocked with old Nordic folk tales and Icelandic poetry. Guests are encouraged to add their own tales to the mix (published on the hotel’s website), inspired by the jaw-droppingly beautiful Snæfellsnes Peninsula.
7. 101 Hotel
When it comes to Reykjavik, creativity isn’t just an add-on; it’s practically in the air. For those who want to dive headfirst into Iceland’s chicest design scene, 101 Hotel is the crème de la crème of the best hotels in Iceland. As a proud member of the Design Hotels group, 101 Hotel isn’t just stylish—it’s got fashion sense to spare.
The interiors here are a monochrome masterpiece, blending black and white in a way that says “I’m too cool for color, darling.” The contemporary Icelandic art adorning the walls is as striking as the designer furnishings that make you feel like you’ve stepped into a high-fashion magazine spread.
Rooms at 101 Hotel are cozy yet undeniably fashionable, with wooden floors adorned with rugs, beds that practically beg you to snooze in them, and a view of Mt. Esja that’s so picturesque it’s practically a postcard. The hotel also boasts a restaurant that locals rave about and a chic bar where you can sip cocktails surrounded by tree-trunk tables and a toasty fireplace. All this is just a hop, skip, and a jump from Reykjavik’s main drag, Laugavegur.
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8. Hotel Flatey
If you’re embarking on an adventure from Stykkishólmur, don’t miss the Westfjords ferry—a charming vessel that navigates through a labyrinth of rocks, skerries, and islands, eventually making its way to Iceland’s least-visited region. But hold your excitement, because the ferry makes a special pitstop at Flatey, a magical island with a population so small you’ll wonder if they’re all in on a secret.
The best hotels in Iceland often come with a twist, and Hotel Flatey is no exception. Nestled on this enchanted island, Hotel Flatey is the quintessential summer escape. With its charmingly colorful houses and a time-warp feel that makes you question reality, it’s the place where Icelandic summer’s hazy golden light makes everything look like a postcard come to life.
Open only during the summer (because apparently, Icelandic winters are a bit too quiet for its taste), Hotel Flatey offers cozy rooms in several 19th-century homes. Inside, the décor is so poetically Scandinavian you might expect a Scandinavian deity to pop in for tea. The island’s pub and lounge, located within the hotel, is the go-to spot for swapping stories with locals and summer wanderers alike. The entire experience feels like crashing at a distant Icelandic relative’s house—if that relative had a flair for cozy, uncluttered design and knew how to make guests feel like family.
9. Hotel Búðir
Iceland’s charm lies in its ability to make you feel like a tiny speck in a grand, epic landscape. If the overwhelming beauty of this island doesn’t leave you slack-jawed and speechless, you’re doing it wrong. And if you’re seeking one of the best hotels in Iceland that perfectly embodies this awe-inspiring isolation, look no further than Hotel Búðir.
Perched on a remote beach on the southern edge of the Snæfellsnes Peninsula, this gem is as isolated as it is enchanting. Originally a Danish trading post, Hotel Búðir now offers unrivaled views of Iceland’s dramatic landscapes, from the shimmering bay to the imposing glacier in Snæfellsnes National Park. The setting here is so breathtaking, you’ll forget your own name, let alone your to-do list.
Inside, Hotel Búðir keeps things understated but stylish, with vintage furnishings that scream “timeless elegance” without shouting. The interiors match the sublime surroundings perfectly—think cozy, calming, and sophisticated. The restaurant is a local legend, drawing food lovers from all over Iceland to taste its culinary delights.
