Best Places To Eat In Iceland (Reykjavik & Surrounding Areas)

Most people think of Iceland for its amazing scenery and nature. While it’s true that the abundant waterfalls, glaciers and geysers are incredible, it’s also true that there’s some good eating in Iceland. While you’re there, there are some staple cultural meals that aren’t to be missed. Here you’ll find a list of the restaurants that are a must to stop at for classic Iceland food and special experiences you can only enjoy here.

I’ve spent quite a bit of time in Iceland and have visited about half a dozen times, and I have to tell you, when I’m away for too long, I truly start to miss the food and some of my favorite spots I’ve listed here. They are broken into categories of the best places for more expensive splurge meals, moderately priced restaurants (for Iceland, anyway), best cafes, tips for eating in Iceland on a budget, and best restaurants outside of Reykjavik.

There is also a section of at the end of some Icelandic foods to try from a grocery store if you’ll be stopping into one, including some of my favorite Icelandic treats to bring home with you!

Best Splurge Restaurants in Reykjavik for Dinner

1. Grillmarkaðurinn is one of my favorite restaurants. I have to go and get the grilled lamb and extra side of fried potatoes with garlic sauce. The beef tenderloin, arctic char, steak, and meat skewers are all incredibly delicious as well. Plus, the restaurant is beyond beautiful! Visit their website for the menu and reservations.

2. Fiskmarkaðinn, the sister restaurant of Grillmarkaðurinn, specialize in all kinds of locally sourced seafood. Tuna tacos and seafood soups are excellent starters, and the halibut steak or salmon are not to be missed for main dishes. You can view their menu and make reservations on their website.

3. Located in a 160 year old building in the heart of Reykjavik, Matarkjallarinn (translated to Food Cellar) is a wonderful dining experience. The pan friend arctic cod with goat cheese is amazing, as is the smoked lamb, fisherman’s soup, and beef pepper steak. They also have a “secret menu” if you’re feeling adventurous! Get a reservation and view the menus here.

4. Apotek is another notable splurge restaurant. Here you’ll want to try the rack of lamb, tiger shrimp salad, salmon or meat platter. Otherwise you can’t go wrong with any of the three cuts of lamb they offer daily. On Sundays they host a traditional lamb roast that’s served to the table family style. If you don’t want that, be sure to pick one of the other 6 days of the week to dine here. Visit their dinner menu and make reservations on their website.

Best Moderately Priced Restaurants in Reykjavik

1. Lamb Street Food is awesome. The wraps are so, so good. Any of the signature lamb wraps are great. I also love the “little lamb” menu option which is a little bit more of a classic. Owned by a husband and wife team, they specialize in all things local, Icelandic lamb. Everything, including their sauces, is homemade daily.

2. Reykjavik Fish is a great little restaurant on the corner right across from the harbor docks. They have great fish and chips (and beer). They are reasonably priced for a sit-down restraurant in the heart of downtown, and the portions of fresh fish and chips are generous.

3. Fish and Chips Vagninn is a fish and chips stand that serves the freshest and best quick food option when it comes to fish and chips. Unlike the previous fish and chips option listed that’s a sit-down restaurant, this one is a stand you walk up to, get your meal in a cardboard box and can go find a bench to sit, eat and enjoy the harbor. This is a 4th generation owned food stall, and they catch the fish on their own fishing vessel the previous day, process and chill it overnight, and then serve it to you the next day. This is a must-eat every time I’m in Iceland!

4. Barion Bryggjan Brugghús was the first independent microbrewery in Iceland. If you’re a fan of trying different types of beers, this is the place for you. They offer a beer and food pairing experience which is super fun, and gives you a great taste of some local beer and food.

5. Icelandic Street Food has very reasonable prices and very good food to match. This place is great for a quick bite to eat or affordable lunch or dinner on a chilly Iceland day. The owner is so warm and goes out of his way to ensure you’re taken care of! The soup is all you can eat, and the lamb soup served in a bread bowl is wonderful, as is the fish and mashed potatoes. They also have great waffles!

6. Bæjarins Beztu Pylsur, the ever-popular, famous Icelandic hot dog stand. It’s probably true that everyone who lives in Iceland has grabbed a hot dog here at least once, and they’ve had some rather noteworthy visitors over the years including Bill Clinton, Metallica, and Anthony Bourdain when filming for his show No Reservations. While this isn’t a place you need to go to more than once, it’s more of a place to stop at to say you did.

Best Cafes & Bakeries in Reykjavik

1. Brauð & Co has the most amazing cinnamon croissants and cinnamon buns! They are always fresh, perfectly baked, light and melt in your mouth. I can’t say enough good things. Truly the best tasting baked goods, and you can even grab a loaf of bread here to take back to your hotel or Airbnb.

2. Bernhoftsbakari is a warm and welcoming place to grab an affordable bite to eat for breakfast. They have great coffee, cakes and fresh pastries. If you’re visiting in the afternoon for a snack, their pretzels are awesome! Or grab a box of pastries before you head out of town to snack on while you drive to a waterfall or glacier!

3. Deig bakes everything fresh in the shop, and is a really affordable option for breakfast or lunch. You can get a bagel with warm butter, delicious cream cheese, or for lunch opt for a bagel sandwich. Their donuts are the best in Iceland and I promise you’ll end up stopping in more than once on your trip! Make sure to try a milk caramel donut!

Best Restaurants in Surrounding Areas

1. Efstidalur Farm is a fun place to stop for a very “Icelandic” experience- ice cream made fresh right from the cows on the farm! Grab your creamy, delicious ice cream and check out the animals hanging out in the barn next door. It’s not far off of the Golden Circle, and a great visit for kids and adults alike to see what life on an Icelandic farm is like!

2. Fridheimar Farm has become a rather famous stop. Finding a tomato farm and greenhouse in the middle of Iceland is rather unexpected, which has made this restaurant quite a well-known place to visit. Here you’ll find a menu that is all things tomato. Every dish is based on tomatoes in it’s many forms, but they specialize and are most known for their soup. You’ll get to eat right in the greenhouse, so it’s a unique experience to have while you’re in Iceland!

3. Cafe Bryggjan is right on the harbor in Keflavik, making it a great stop on the day you visit the Blue Lagoon. They are famous for their all you can eat lobster soup, although the Plokkfiskur (traditional Icelandic stew made with fresh, local cod, potatoes and melted cheese) is a top personal favorite!

4. Fjorubordid Restaurant in Stokkseyri for Icelandic lobster (langoustine). This restaurant by the sea (the name itself means “by the seashore”) has the best lobster in Iceland. If you only eat at one lobster house, it should be this one. The butter sauce is out of this world good, as are the soups. While the lobster and potatoes are the star, the garlic onion dip for the bread deserves an honorable mention. Their desserts are fantastic as well.

5. Laugarvatn Fontana is situated near the Golden Circle drive, and is a fantastic stop for the geothermal pools of varying temperatures, and for the rye bread baked in the hot sand. It’s a really cool experience to learn how the bread is baked. The soup is amazing, too!

6. Ingolfsskali Viking Restaurant to eat in a Viking longhouse. This is a gem of a place between Reykjavik and Vik, and a great stop to make if you’re driving the Golden Circle or on your way back into Reykjavik after a day of exploring the waterfalls and black sand beaches around Vik. The restaurant itself looks like it’s built into the earth in a traditional viking fashion. It’s a fantastic atmosphere with equally amazing food (lamb, char, duck!), and is sure to be a really special experience.

Iceland Eating On A Budget

Iceland is an expensive country to visit, there is no doubt about that. Food prices are much higher than we’re used to due to several factors, the biggest of which being the location of Iceland. It’s an island very far north of where a majority of food is grown, and transporting goods to Iceland raises the prices dramatically. Even the equipment needed to run a farm must be imported, making farming and raising livestock costly, too.

You can expect to spend between $70-$110 USD per day, per person on your three meals. If you’re eating on a budget in Iceland, there are a few ways to keep your costs down. First, eat things that are local to the country. Opt for lamb or fish dishes which is are produced there as opposed to beef, a majority of which is imported.

Secondly, choose a hotel with a kitchenette, or Airbnb with a full kitchen and cook most meals yourself. Cooking your own breakfast, packing a lunch for when you’re out exploring, and then only eating dinners out is a great way to cut costs. Buy your beer or liquor at the liquor store.

I recommend getting groceries at Bonus Grocery or Costco. Prices at Bonus grocery stores are comparable to the United States. There are 30 different Bonus locations around Iceland, so they are convenient to stop into.

The Iceland Costco location is about 6 miles south of downtown Reykjavik, and located in the same shopping center as Ikea and a Bonus grocery store. If you have a Costco membership at home, you follow the same process to enter in Iceland: by simply flashing your card.

The hours are similar to to US locations as well, but make sure to check before driving over. If you forget heavy winter gear, this is a great place to purchase a jacket at a fraction of the cost it will cost you in a downtown clothing shop.

Other benefits to stopping into Costco in Iceland include the food court and gas station. At the Iceland Costco food court you can grab a cheap bite to eat like the classic hot dog, pizza and soda that Costco is known for.

I highly recommend getting gas while you’re at Costco to further save you money on your trip. While food is expensive, gas is even more-so. Filling your tank while you get groceries before heading out on your Iceland adventure will save you about $1 USD per gallon (average is $8 USD a gallon elsewhere).

Icelandic Staples To Try While Grocery Shopping

Grocery items to try include Icelandic butter (Smjör brand) which is some of the best in the world. Hvítlauks sósa (garlic sauce) from the brand E.Finnsson is an Iceland favorite that’s put on everything from roasted or grilled lamb, burgers, fries, and more. It’s my favorite – so good!

Kokteilsósa is another popular sauce that’s used for everything. It translates to cocktail sauce, but it’s not used like cocktail sauce in the US. It’s creamy and tangy and put on meat, burgers, fries, fish, vegetables and more. Pick up some Icelandic cheese, like piparostur, or black pepper cheese.

Einstök is one of the best beers in Iceland, and I always shove some into my bag to bring home!

Icelandic candy and chocolate is so good, and of course you can only find it here so grab some to try or bring home! My favorites are Hraun lava bites, Bingo Balls, Noi Sirius milk chocolate with toffee bars, and Noa Kropp chocolate coated crisp puffs.

Saltverk is a flaky sea salt produced using only energy from geothermal hot springs in the northwest of Iceland, in the same method first used in the 17th century. It makes a great gift to bring home being it’s small and affordable.

Been to Iceland?

If you’ve taken a trip to Iceland and had a fabulous meal from a restaurant that isn’t on this best restaurants in Iceland list, please leave a comment and share! We love finding new places and supporting local businesses!