Reykjavík Backpacking Travel Guide

Information on hostels, transportation, cheap food and drinks, sights to see, activities and more.

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Reykjavík is a beautiful and charming city that has a small town vibe to it, despite it being the capital of the country. Over two-thirds of the 330,000 that live in Iceland, do so in Reykjavík and the surrounding area. Reykjavík can be a really fun city, especially over the weekend when the downtown area turns into a gigantic all night party every Friday and Saturday night.


The Loft Hostel

Located on Reykjavík’s main street and 5 minutes walking distance from Hallgrímskirkja. Loft Hostel has some great views from its large rooftop terrace café that overlooks the city centre. Perfect for rooftop beers on long summer evenings. The upstairs bar and lounge area is very cosy and is a great spot to make new friends and organise road trips or day tours. They sometimes host local bands or other functions in the bar area meaning the evenings are always interesting. Even if you are not staying at Loft, the bar is worth checking out if you want to meet other travellers. Book the Loft Hostel here!

KEX Hostel

Housed in an old biscuit factory in the heart of Reykjavík, KEX is just steps from all the bars, clubs, and music venues that gives Reykjavík its reputation as a nightlife hotspot. KEX has a large and popular bar on its top floor which is full most nights. This area is the best place to meet and socialise with other travellers and is particularly useful for arranging car shares and road trips. Book KEX Hostel here!

Bus Hostel

Bus Hostel is worth mentioning for a few reasons. Firstly, it is cheaper than both Loft and KEX. Secondly, Bus Hostel is very convenient for those arriving at the main bus station late in the evening do not want to walk far to reach their hostel. The facilities are nice and the bar area is a decent place to socialise, though a lot smaller and less active than Loft or KEX. It’s about a 15 min walk into the centre of Reykjavík from Bus Hostel. Book Bus Hostel here!

Sights and Highlights

Free Walking Tour

This tour takes you on foot around the heart of Reykjavík with an English-speaking local and a history graduate. The main focus is the general history of Iceland and the evolution of the town of Reykjavík. You learn about elves, Vikings, food, nightlife, music, the Icelandic economy and political affairs. Finally there are the funny facts about Iceland and a list of places you must see in Reykjavík.

The Settlement Exhibition

The Settlement Exhibition is a great place to learn about the Viking heritage of Iceland and the early settlers that came to these lands in 871 AD. The museum is based on a 2001 excavation of the area that discovered the oldest archaeological evidence of human settlement of Iceland. A really nice and interactive exhibition that it positioned literally on top of and around the first settlement of Reykjavík.

Public Baths

Iceland has a strong public bath culture, similar to many other northern European and Scandinavian countries. There are two large heated bath complexes in Reykjavík. Vesturbaejarlaug is located a short walk west of the downtown area while Laugardalslaug is little further away from the city to the east. Unless you have a car or are staying to the east, Vesturbaejarlaug is the best option. The Blue Lagoon is a man-made, artificial, expensive tourist trap so skip it and go to these public baths and hang with Reykjavík locals instead. The best time to visit is in the evenings after a busy day of sightseeing, particular in the winter.


This uniquely styled Lutheran church towers over the city on top of a hill. In front is a statue of Leif Ericsson, the Norse explorer who sailed to North America in the 10th century. The United States gave this statue to Iceland in 1930, in honour of the 1,000th anniversary of the Iceland parliament. Admission up to the viewing platform at the top if this magnificent church is about 7€.


To Eat

Iceland is an expensive country, one way to save some money is to buy food from the supermarket and then use the cooking facilities available in all the hostels. The cheapest supermarket chain is Bonus and google maps lists all three of the locations in downtown Reykjavík.

Mandi Reykjavík

A good kebab shop in the centre of Reykjavík. They are open until 2am every night except Friday and Saturday when they don’t close until 6am.

Laundromat Cafe

A cool and trendy café/restaurant/bar on the main street. These guys make good coffee and really tasty food as well. They have a laundromat in the basement and considering the lack of laundry facilities at any of the hostels, you will want to check this place out.

Café Loki

Situated across the road from the Hallgrímskirkja church, Café Loki a great spot to try some traditional Icelandic cuisine. They offer four different mixed plates consisting of slices of Icelandic rye bread with butter and a range of traditional savoury toppings along with a side serve of hákarl. It wouldn’t be right to visit Iceland and not try hákarl.

Bæjarins Beztu Pylsur

Translates in english to ‘the Best Hotdog in Town’. Bæjarins Beztu is a Reykjavík institution and has operated since 1937. Some say they make the best hotdogs in all of Europe. Among famous people who have eaten at Bæjarins Beztu are Bill Clinton, former president of the United States, and James Hetfield, vocalist of the popular heavy metal band Metallica.

For Drinking

Skúli Craft Bar

Astonishingly good craft beer from the best craft breweries around the world can be found here. The beer is not cheap, but it is damn good.

The English Pub

A very popular English-style pub in the heart of the city, with a wide range of beers. Guaranteed to be fairly full most nights of the week and then packed on weekends until the morning.


Everything in downtown Reykjavík is close together and easily walkable. The only real decision to be made with regards to transport is whether you decide to hire a car or join a tour group to get out of Reykjavík and see the Icelandic country side. Hiring a car is certainly cheaper and offers more flexibility provided you can share costs with at least one other person.

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