Icelandic craft beer — breweries, bars, and what to drink in Iceland
Reykjavik: Beer and booze bar walk
What is the Icelandic craft beer scene like?
Iceland's craft beer scene is small but lively. The main producers are Borg Brugghús, Kaldi (Bruggsmiðjan), Ölvisholt, and Gæðingur. Beer was illegal in Iceland until 1989, which makes the craft beer culture relatively young. Expect to pay ISK 1,500–2,000 for a pint in Reykjavík bars.
Beer was illegal here until 1989
Iceland’s relationship with beer is worth understanding before you start drinking it. The country voted for national prohibition in a 1908 referendum, and the law came into force in 1915. Spirits were legalised in 1921 after a trade agreement with Spain (Spain refused to buy Icelandic fish unless Iceland bought Spanish wines), and wine followed in 1935. But beer — specifically any drink with more than 2.25 percent alcohol — remained illegal until March 1, 1989.
The logic was partly temperance, partly political: beer was associated with Denmark (Iceland’s former colonial ruler) and considered culturally inferior to spirits. Icelanders drank vodka and spirits through much of the 20th century while beer was banned.
Legalisation in 1989 is still celebrated as a national date by Icelanders with a sense of amused historical pride. The craft beer scene that followed has grown significantly since the early 2010s.
The main Icelandic breweries
Borg Brugghús
Borg (meaning “fortress” or “castle”) is Iceland’s largest craft brewery by volume and the most internationally visible. Based in Álftanes near Reykjavík, Borg produces a full range including lagers, IPAs, stouts, sours, and seasonal specials.
Their flagship is Bjór Nr. 19 Garún, an Icelandic oatmeal stout. The Úlfur IPA is widely distributed. Borg beers are sold at Vínbúðin (state alcohol shops) and in most Reykjavík bars.
A brewery tour and tasting experience is available for those interested in seeing the production side.
Bruggsmiðjan — Kaldi
Bruggsmiðjan operates the Kaldi brand from Árskógssandur in northern Iceland near Akureyri. Kaldi lager is the most widely sold Icelandic beer in the country and the closest to a mainstream national beer identity. It is Czech-style lager brewed with Icelandic glacier water, clean and malt-forward. ISK 300–400 in Vínbúðin; ISK 1,500–1,800 in bars.
The Kaldi Bar in Reykjavík (Laugavegur 20) is the brewery’s Reykjavík outpost, serving Kaldi on tap and small Icelandic food.
Ölvisholt Brugghús
Based at the Ölvisholt farm in South Iceland, near the Ölfusá river east of Selfoss. One of Iceland’s older craft operations. The Skjálfti (tremor) pale ale and Freyja wheat beer are their most accessible products. Less visible than Borg or Kaldi but reliable. Available at Vínbúðin.
Gæðingur
A Reykjavík-based microbrewery with a more experimental profile — regular small-batch releases, seasonal offerings, and collaborations with international breweries. The tap list changes frequently. If you want to find the most current Icelandic craft releases, Gæðingur and bars that stock it are the best reference point.
Where to drink beer in Reykjavík
Mikkeller Bar (Hverfisgata 12)
The Reykjavík outpost of the Danish craft beer brand. A tap list of 20+ rotating beers including Icelandic and international craft options. Good for a systematic tasting of what is available. The space is quiet by Reykjavík standards — a drinking bar rather than a party venue. ISK 1,500–2,200 per pint.
Kaldi Bar (Laugavegur 20)
Bruggsmiðjan’s brand bar. Kaldi lager on tap, some seasonal variants, and a quiet enough atmosphere to have a conversation. Reasonably priced by Reykjavík standards. Popular after-work stop for locals.
Skúli Craft Bar (Aðalstræti 9)
Small, eclectic, rotating taps with an emphasis on Icelandic and Nordic craft beers. Knowledgeable bar staff. Located in the oldest street in Reykjavík. ISK 1,600–2,200 per pint.
Bryggjan Brugghús (Grandagarður 8)
The Old Harbour brewery and bar. Brews on-site, visible through the production windows. The beer is solid and the setting — industrial harbour building — is pleasant. Mains on the food menu run ISK 3,000–5,000.
Reykjavík beer and bar walking tour — Icelandic craft beer tastingsBeer prices in Iceland
Beer is expensive. A pint at a Reykjavík bar runs ISK 1,500–2,000 for a standard 0.5L pour. A 330ml bottle is ISK 1,000–1,400. Cocktails run ISK 2,000–3,000. If you plan to drink several beers in a Reykjavík evening, budget accordingly.
The significantly cheaper option: buy beer at a Vínbúðin state alcohol shop. A 500ml can of domestic lager costs ISK 350–450. Craft beers are ISK 500–900 per can. You can pick up a four-pack for what a single bar pint costs. Pre-drinking before an evening out is common practice among budget-conscious visitors.
Vínbúðin stores have specific opening hours — typically 11:00–18:00 or 19:00 Monday–Thursday, until 20:00 on Friday, shorter hours on Saturday, and often closed on Sunday. Plan accordingly if you want to stock up.
Seasonal and special releases
Icelandic brewers produce seasonal releases worth seeking out:
Þorri season (January–February): Several breweries release midwinter beers, some flavoured with skyr, rye bread (rúgbrauð), or dried fish. These are available at Vínbúðin in January and February.
Summer: Lighter lagers and fruit-forward wheat beers are common summer releases. Borg’s summer seasonal is usually available at major Vínbúðin branches.
Christmas (Jólabjór): Christmas beer is released on the first day of Advent (approximately November 30) and is a genuine Icelandic tradition. Multiple breweries produce versions — the bottles often have distinctive seasonal labels. Sold out quickly at Vínbúðin; worth grabbing early in December.
The Vínbúðin system
Vínbúðin is the state-owned retail chain that has a monopoly on alcohol sales above 2.25 percent ABV. This is not a black market — it is the legal and normal way to buy wine, spirits, and beer in Iceland. Supermarkets sell low-alcohol beer (under 2.5%) but nothing stronger.
There are about 50 Vínbúðin outlets across Iceland. In small towns, there may be only one and it may have limited hours. Planning purchases ahead avoids running dry on a Sunday in a remote area. The website (vinbudin.is) allows searching for products by store and checking stock.
Frequently asked questions about Icelandic craft beer
When did beer become legal in Iceland?
March 1, 1989. Beer was banned under prohibition laws that dated from a 1908 referendum. Iceland is the last country in the Western world to have fully legalised beer, and the date is still noted annually.
What is the best Icelandic beer to try?
For accessibility: Kaldi lager. For craft character: Borg’s Garún stout or Úlfur IPA. For something unusual: a Gæðingur small-batch release or a seasonal Þorri beer. If you are at a bar with rotating taps, ask the staff what is currently on from local producers.
Is Icelandic beer good quality?
Yes. The water quality — glacier and spring water with minimal processing — gives a clean base that works particularly well for lagers and pale ales. The brewery scene is small and relatively recent, but the technical quality is high. Kaldi has won international awards for its Czech-style lager.
Where can I buy Icelandic craft beer to take home?
Vínbúðin stores, particularly the Keflavík Airport duty-free outlet (post-security), stock a selection of Borg, Kaldi, and other local brands. The airport Vínbúðin has better stock of craft varieties than many in-town outlets. Buying at the airport avoids carrying liquid through the trip.
What is the alcohol content of typical Icelandic beers?
Kaldi lager is 4.6%. Borg Úlfur IPA is 5.9%. Garún stout is 11.5% — a strong beer, sip carefully. Most Icelandic craft beers fall in the 4.5–7% range for regular releases; seasonal and specialty beers can go higher.
Are there brewery tours in Iceland?
Borg Brugghús offers guided brewery tours and tastings from their Álftanes site. Bryggjan Brugghús at the Reykjavík harbour allows viewing of the brewing operation from the bar area. A beer-focused walking tour of Reykjavík’s bars and the story of Icelandic prohibition is a popular 2–3 hour activity.
Iceland’s bar culture and drinking scene
Reykjavík’s bar scene is concentrated around Laugavegur and the streets immediately off it — Austurstræti, Bankastræti, Tryggvagata. The city punches well above its weight for nightlife given a population of around 130,000 in greater Reykjavík.
The structure of an Icelandic night out has historically involved pre-drinking at home (purchasing alcohol at Vínbúðin while it is open, then drinking before bars become expensive), followed by arriving at bars relatively late — midnight or after — and staying until 04:00 or 05:00 on weekends. This pattern is driven by alcohol prices: a round of four beers in a bar costs ISK 6,000–8,000, making pre-drinking an economic necessity for many locals.
Prikið (Bankastræti 12): The oldest bar in Reykjavík, open since 1951. Hip-hop music, basic but reliable beer selection, a mixed local and tourist crowd. Not pretentious.
Kiki Queer Bar (Laugavegur 22): The LGBTQ+ community bar in Reykjavík, in a city with very high acceptance levels. Weekly themed nights.
Húrra (Tryggvagata 22): Live music venue and bar, in a converted warehouse. Good for local bands and a varied beer selection.
Bar Ananas (Laugavegur 57): Tropical-themed, known for rum drinks and a lively atmosphere on weekends.
For a structured introduction to the bar scene with historical context on Icelandic drinking culture, a guided bar walk is worth considering.
The Vínbúðin system in detail
Iceland’s state alcohol retail monopoly (Vínbúðin) was established as part of the compromise that ended beer prohibition in 1989. Rather than full liberalisation, Iceland adopted the Nordic model: beer, wine, and spirits above 2.25% ABV are sold only through licensed state shops. This gives the government control over pricing (alcohol is taxed heavily) and distribution.
Currently there are about 50 Vínbúðin outlets across Iceland. In the capital area, there are enough locations to be convenient. In small rural towns, there may be one outlet with limited hours — sometimes only 4–5 days per week, closing early. Planning ahead for Sunday closures (many rural Vínbúðin are closed Sunday) prevents a dry camping night.
For online research, the Vínbúðin website (vinbudin.is) allows product searches by store and shows real-time stock. You can filter for craft Icelandic beers, find the nearest store with specific products, and check prices before visiting.
The duty-free shop at Keflavík Airport’s arrivals hall and departure area both sell alcohol at duty-free prices, which are meaningfully lower than in-country Vínbúðin prices. If you want to bring spirits or wine home, or load up on Icelandic craft beers to take home, the airport departure Vínbúðin typically has good selection.
Craft beer vocabulary and ordering
When reading Icelandic beer menus, some terminology helps:
Ljóst öl: Light beer (lager style). Myrkur öl: Dark beer (stout, porter). Humlað öl: Hopped beer — used to distinguish from unhopped historical preparations. Allur: A pint (full measure). Hálft: Half pint.
Most bar menus are in Icelandic, but bar staff throughout Reykjavík speak English fluently. Asking “what Icelandic beers do you have on tap?” will get a direct answer.
International beers in Iceland
The local craft selection is limited enough that many bars and bottle shops also stock international craft beers. Danish craft beer (Mikkeller, To Øl, Amager) is the most visible import. Belgian, Norwegian, and American craft beers appear at specialist bars. The Kaldi Bar and Mikkeller Bar have the widest imported selections.
If you want a specific style that Icelandic craft breweries do not make well (certain Belgian farmhouse ales, for example), a specialist bar is worth seeking out. But for a trip focused on experiencing Icelandic food and drink culture, local beers at local bars are the more interesting choice.
Pairing Icelandic beer with food
The combination of Icelandic food and beer is underexplored compared to, say, Icelandic craft beer and Icelandic music or Icelandic craft beer and the northern lights (both of which appear in marketing materials regularly).
Practical pairings:
- Kaldi lager + harðfiskur (dried fish): The lager’s crispness cuts through the concentrated fish flavour. A genuinely complementary combination.
- Borg Garún stout + skyr cake: The stout’s roasted notes work with the mild dairy tang.
- Ölvisholt Skjálfti pale ale + smoked salmon or Arctic char: A lighter beer that does not overpower delicate fish.
- Gæðingur seasonal sour + langoustine: Acidic beer and sweet crustacean is a classic combination anywhere.
The best restaurants in Reykjavík guide lists venues where both good food and good local beer are available simultaneously.
Icelandic spirits and the wider drinking landscape
Beer is one part of Iceland’s alcohol culture. The national spirit is Brennivín — a caraway-flavoured aquavit nicknamed “Black Death” (svarti dauði) for its black label and potency. Brennivín is typically 37.5% ABV, produced by Egill Skallagrímsson brewery. It is traditionally consumed ice-cold with hákarl (fermented shark) at þorrablót midwinter festivals, but it is also drunk as a digestive after fish dishes.
Several artisan spirits producers have emerged since 2015. Þrír Hnokkar is a notable small-batch gin producer using Icelandic botanicals (crowberry, birch buds, angelica). Eimverk distillery produces Flóki — an Icelandic single malt whisky aged in Icelandic oak that has garnered international attention. These are niche products at premium prices (ISK 5,000–12,000 per bottle) but represent a genuine craft spirits development that parallels the craft beer movement.
For visitors interested in Icelandic spirits, the Vínbúðin duty-free at Keflavík Airport departure hall typically stocks Brennivín, Flóki whisky, and selected local gins.
Regional breweries beyond Reykjavík
Iceland’s craft brewing scene extends beyond the capital, though Reykjavík remains the concentration point. Knowing the regional operations helps visitors planning wider itineraries.
Akureyri Brewery (Bruggsmidjan / Kaldi): Based in Árskógssandur near Akureyri in the north, Kaldi is one of the country’s most respected craft brewers, known for clean Czech-style lagers using actual Czech brewing techniques. The Kaldi Lager is available across Iceland; brewery tours are possible in summer. If you’re visiting Akureyri or the Mývatn area, Kaldi is the regional brewery of choice.
Ölvisholt Brewery: Located at Selfoss in the south of Iceland, Ölvisholt produces the widely distributed Lava Imperial Stout — a robust, 9.4% stout named for the volcanic landscape. Available at Vínbúðin nationally and at various Reykjavík bars. One of the most awarded Icelandic beers in international competition.
Viking Brewery (Ölgerðin): Iceland’s largest commercial brewery produces the mainstream Viking Lager and Golden Ale found everywhere from petrol stations to supermarkets. Not craft by definition, but the Egill Skallagrímsson brand (same company) produces some more interesting seasonal and special releases. Viking Gold (3.5%) is the budget session lager — inexpensive by Icelandic standards and widely available.
Understanding the pricing geography: The cheapest legal alcohol in Iceland comes from Vínbúðin, where a 500ml craft beer runs ISK 500–900. Bar pints cost ISK 1,200–1,900. Duty-free at Keflavík Airport is the cheapest option — the duty-free store is available on arrival as well as departure, allowing travellers to stock up before beginning their trip.
These regional craft producers mean that wherever your Icelandic itinerary takes you, there is typically a local or near-local brewing option worth trying rather than defaulting to the imported international brands that fill convenience store refrigerators.
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