Mastering Iceland's Roundabouts: A Driver’s Guide

If you're planning an Icelandic road trip, renting a car offers unmatched freedom and flexibility. From winding coastal drives to scenic highland routes, Iceland is a destination best explored on your own terms. But before you hit the road, there’s one important topic that often puzzles visitors: Iceland’s roundabouts.

Driving in Iceland can be quite different from what travellers are used to at home. At Höldur, your safety is our top priority. That’s why we’ve created this helpful guide to demystify the rules of Icelandic roundabouts, ensuring you drive with confidence and ease.

 

Why Renting a Car in Iceland Is the Key to Unforgettable Adventure

Whether you're chasing the northern lights, cruising past black sand beaches, or discovering hidden waterfalls, renting a car in Iceland is your ticket to total freedom. Public transport is limited, and guided tours often stick to fixed routes. But with your own vehicle, you set the pace — stopping whenever inspiration strikes.

At Höldur, we provide reliable, eco-conscious rentals and expert travel support to help you explore safely and comfortably, no matter the season. And part of that support means helping you feel fully prepared behind the wheel.

 

Understanding Roundabouts in Iceland

Roundabouts — or traffic circles — are common across Iceland, especially near Reykjavík and in towns around the Ring Road. While they help manage traffic efficiently, their rules can differ from what UK, US, or Canadian drivers might expect.

Here’s what you need to know to navigate them like a pro.

1. The Golden Rule: Inner Lane Has Priority

Unlike in many other countries, in two-lane roundabouts in Iceland, the inner lane (left lane) always has priority. If you're in the outer lane and planning to exit, you must yield to vehicles coming from the inside lane before you can leave the roundabout.

This often surprises drivers used to giving way to the outer lane — but failing to yield here can be dangerous.

2. Single-Lane Roundabouts Are Simple

Many rural roundabouts in Iceland are single-lane. In these cases, standard roundabout rules apply: give way to traffic already circulating, enter when clear, and exit safely.

3. Slow Down, Especially in Winter

Approach roundabouts at a reduced speed, especially during winter months when roads can be icy. Icelandic weather can change quickly, and traction may be lower than expected.

4. Use Your Indicators Clearly

Always indicate your intended exit. Signal right when you’re about to leave the roundabout, helping others anticipate your movement — especially if you’re in the inner lane.

Iceland Driving Etiquette & Essentials

Renting a car in Iceland means embracing the local driving style — cautious, courteous, and nature-aware. Here are a few safety reminders:

• F-roads require a 4x4 and can only be accessed during summer months.

• Headlights must be on at all times — day or night.

• Off-road driving is illegal and damaging to Iceland’s delicate ecosystems.

• Weather and road closures happen often — check daily updates on vedur.is and road.is

Remember: your journey is part of the adventure, and the more informed you are, the more enjoyable (and safe) it will be.

See also our guide: What to know about driving in Iceland.

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FAQs: Driving in Iceland and Roundabout Navigation

Do Icelandic roundabouts go clockwise or counterclockwise?

They operate counterclockwise, just like in the UK and most of Europe.

What’s the rule for exiting a two-lane roundabout in Iceland?

The inner lane always has right of way. Yield to it before exiting from the outer lane.

Are roundabouts common on the Ring Road?

Yes, especially near towns. Pay attention to signage and markings.

Is it safe to drive in Iceland in winter?

Yes, but with caution. Iceland's roads are well-maintained, but always check conditions before driving. Höldur provides vehicles with studded winter tires and 4WD for safer travel. For more tips, see our winter driving guide.

Can I use a GPS while driving in Iceland?

Absolutely. Many of our rentals come equipped with navigation. For even better experience you can rent a Garmin device that comes with detailed regional map data for Iceland, along with the latest updates! 

Do I need an international driver’s licence?

If your licence uses Latin characters and is valid, you don’t need an international one.

Is it difficult to adjust to Icelandic road rules?

Most travellers adapt quickly. Learning about roundabout rules and weather safety is important.

Are parking rules strict in Iceland?

Yes. Only park in designated areas. Illegal parking, especially on natural grounds, can result in fines.

How do I handle livestock or wildlife on the road?

Slow down and yield — they always have the right of way.

What should I do in case of a breakdown or emergency?

Call 112 for emergencies. Höldur’s support line is available 24/7 for rental assistance.

Explore With Confidence

Roundabouts might feel unfamiliar at first, but with the right knowledge, you’ll master them in no time. Renting a car in Iceland opens the door to experiences beyond the guidebooks — serene fjords, lava fields, untouched coastlines, and spontaneous detours.