Best Luxury Hotels In Iceland

Located in the heart of the North Atlantic, Iceland beckons with its otherworldly beauty, captivating culture, and a sense of untouched wilderness that evokes awe at every turn. From the mesmerizing dance of the Northern Lights to the soothing warmth of geothermal springs, and the buzzing cultural and dining scene of Reykjavik, Iceland offers an exclusive experience that promises to leave an indelible mark on the discerning traveller’s soul.

Before you choose your favourite luxury hotel in Iceland, read on to learn a little more about this jewel of an emirate destination. 

Why Visit: The land of geysers, hot springs, heavy metal, volcanic rock and Bjork makes for an exciting and adventurous holiday destination. With some lunar-like terrain, adrenaline-pumping activities, and plenty of alternative attractions, it has much to offer those of all ages and tastes. Reykjavik is one of the top city break destinations in the world, particularly for the discerning traveller, while further afield, visitors can explore stunning landscapes. The country has a reputation for being open-minded as well as environmentally conscious and its unusual architecture proffers some unique, luxurious, and eco-friendly places to stay.

Who Goes: Due to its remarkable diversity, Iceland caters to a wide spectrum of travellers. Whether your passions lie in nature, wildlife, street art, or luxury experiences, this destination offers something extraordinary for everyone. It’s also a popular destination for solo travellers too. 

When to Visit:  As there is so much to do and see no matter what time of year you visit there will be something that captivates you. For outdoor adventures the best time to visit Iceland is between June and August when the weather is at its warmest and the midnight sun emerges. If you’re seeking a glimpse of the spectacular Aurora Borealis, AKA the Northern Lights, then the darker winter months are the time to go. 

How to Get There:  Keflavik is the main international airport, and the arrival point for most international travellers to Iceland. It offers meet-and-greet services and a private airport lounge. 

Private jets can fly into Keflavik or Reykjavik City Airport, which is the main domestic airport in Iceland. 

In the Know: For a spot of whale watching visit Akureyri, it’s said to be the best place to see these majestic marine mammals and known as Iceland’s capital of the Nort, it’s a great city in which to spend a couple of days. 

Hotel Selection: The hotels we showcase in this collection have been selected by our editors, contributors, or trusted locals based on personal experience or credible recommendations. From the renowned international resorts to the lesser-known boutiques, each hotel must excel in service, design and facilities.

UMI Hotel, Hvolsvollur

One of the most beautiful mountain ranges in Iceland is the backdrop to the UMI hotel. The hotel presents bare-foot luxury at its best and is rooted with a deep connection to nature that flows throughout the design, décor and overall experience of the hotel with only 28 simple yet stylish rooms, offering mountain or ocean views, guests will never feel over-crowded. Stunning vistas can also be enjoyed from the hotel’s top-class restaurant which serves Nordic and Icelandic cuisine with a Japanese twist in a warm and welcoming atmosphere and the lounge and bar is the ideal spot to take in panoramas of Eyjafjallajökull, the famous subglacial volcano. For guests wishing to enjoy more than the beautiful views, many action-packed activities such as glacier hikes, kayaking and ice-cave adventures can easily be arranged by the team at the hotel. For those who love nature and adventure, this is the hotel for you!


Edition Hotel Reykjavik

Bringing 5-star luxury to the city, the Reykjavik EDITION is the perfect place from which to enjoy the many attractions of the region. Located in the historical heart of downtown Reykjavik the hotel is a short walk from Laugavegur Street, the city´s vibrant shopping district, and the Harpa Concert and Conference Centre whilst the natural geothermal pools at Sky Lagoon are only a 10-minute car journey away. The modern style flows throughout the hotel and room sizes and classes cover every traveller’s needs – with harbour and ocean views available too. The hotel itself boasts a variety of distinctive food and beverage options; from light bites to alfresco dining through to a more formal dining experience lead by Gunnar Karl Gíslason, Iceland’s celebrated first Michelin-star chef. An onsite gym is also available for guests to work up a sweat.  With a fun-loving vibe and lively spaces to socialise, work and relax – this is the place to be! Edition Hotel Reykjavik is part of the Marriott Collection.


Fosshotel Glacier Lagoon

Found between Skaftafell and Jökulsárlón Glacier Lagoon, Fosshotel Glacier Lagoon is one to add to your Icelandic road trip. The 125 contemporary rooms have a minimal peaceful design, with huge windows looking out onto the local wilderness and the country’s highest peak, Hvannadalshnúkur. High ceilings add to the sense of peace and serenity that this hotel embodies. The hotel’s large restaurant is decorated in a geometric style, with dishes inspired by its natural surroundings. The highlight of this property is, of course, its proximity to the Fosshotel Glacier, providing fantastic hiking on the doorstep.


Hótel Kría

If visiting the south of the island, stay at Hótel Kría in Vik. This opened in the summer of 2018, a cool new addition to the area with black sandy beaches just a five-minute walk away. Light wood panelling, charcoal tones and glass feature heavily in the modern design, both inside and out. Meals are taken in Drangar Restaurant, with lamb and fish being especially popular. Innovative creations such as avocado chocolate pudding, skyr and cucumber crystallised white chocolate with dill and merengue appear on the pudding menu – you won’t want to skip dessert at Hótel Kría.


Canopy by Hilton Reykjavik City Centre

The upscale Hilton chain has you covered on a trip to the heart of the capital at the Canopy by Hilton Reykjavik. The building was once a furniture factory, music and arts venue, repurposed across six interconnected areas forming this eclectic approach to hospitality. Guests are invited to peruse Canopy’s vinyl collection and take a portable record player back to one of their 112 rooms – a selection of which are fully accessible. Pet-friendly and 100% smoke-free, this isn’t the place to stay if you’re a smoker, but a literal breath of fresh air if you’re not.  It’s also home to several dining options, including Geiri Smart, an exclusive restaurant, where chefs prepare food based on the farmers and fishers’ offers of the day.


Alda Hotel

Another city-break favourite is Alda Hotel, on Reykjavik’s main shopping street. Although centrally located, the emphasis here is on tranquillity and calm, creating an oasis-like experience – the outdoor hot tub is perfect for winding down after some hectic sightseeing. 88 swanky guest rooms with L’Occitane toiletries all vary in shape and size, furnished in vibrant colour schemes, eye-catching artworks and designer furnishings. Alda is perfect if you like a stylish, laid back vibe, or are travelling with kids. Meals can be enjoyed at the casual Brass Kitchen & Bar, or you can explore the array of options in the vicinity.


The Retreat at Blue Lagoon

If you fancy staying at the most famous attraction in the country, book a minimalist suite at The Retreat at Blue Lagoon and enjoy views over the volcanic delights of the Blue Lagoon. Spa breaks are a speciality – The Retreat Spa is a part of The Retreat experience. Within the main subterranean spa lies Lava Cove, a private sanctuary, reserved for the affluent, offering gourmet dining, in-water massage, and guided yoga sessions. Be sure to try the signature ritual utilising the silica, algae, and minerals of the geothermal seawaters. There’s also a restaurant with an equally soothing atmosphere. And of course, the lagoon, for quintessential Iceland bathing.


ION City Hotel

Looking out onto the pretty, colourful rooftops of the capital and mountains beyond, ION City Hotel is well-located to explore Reykjavik’s nightlife. One of two ION hotels, rooms feature saunas, recycled wood panelling, organic linens, Bang & Olufsen Bluetooth speakers, mid-century furniture and Scandi style by design studio Minarc. Sumac, the hotel’s restaurant is the hip place to be. One of Iceland’s top chefs Hafsteinn Ólafsson, is at the helm, serving North African dishes in surroundings inspired by the Beirut of the past. Relax in the bar after your meal, with an unusual drinks list including Lebanese wine.


ION Adventure Hotel

Located in Selfoss, the ION Adventure Hotel is a remarkable modernist structure that sits on stilts, cutting an impressive outline in the already dramatic landscape. Once a spooky abandoned inn, it’s now a 45-room (choose between standard and deluxe) boutique hotel with outlooks over Nesjavellir Geothermal Power Plant or across the lava fields towards Thingvellir National Park. As with ION’s City Hotel, there’s a clear presence of salvaged materials in the design with the exterior mimicking the brutal conditions of Icelandic winter. Sigurlaug Sverrisdottir is behind the concept and manager to the ION brand. Once air cabin crew, she’d also created a business, arranging adventure tours -and there’s many wonderful excursions to be enjoyed from here. Adventure Hotel juts out on Mount Hengill as a secluded and sustainable retreat for those wishing to get off the beaten track.


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