Sleeping Under the Northern Lights: The Top 6 Most Unique Hotels in Iceland

Because Iceland is small and wild landscapes dominate the island – and besides Reykjavik, there are no other big cities – you will find some of the most uniquely isolated, mind-blowing places to stay on earth.

So hop in for the ride. We are talking today about my personal choices for the most unique hotels in Iceland, just updated to deliver the absolute best.

What’s not to love about Iceland? The majestic Northern Lights, Vatnajökull glacier, and some of the most beautiful lakes, volcanoes and waterfalls are located in the world’s most northly country. And you have a chance to experience these natural wonders straight from your bedroom. A complete and amazing experience awaits, so make sure to check them all out before picking your favorite.

Tip: If you spend more than just a few days in Iceland, it’s ideal to book at least two (if not more) of these hotels to enhance your experience.

Hotel Ranga

If you are one of those people who love to connect directly with nature without sacrificing comfort, then this is the place for you. Hotel Rangá sits in Hella, roughly a 1.5-hour drive from Reykjavík, giving you the perfect basecamp to explore Iceland’s southern wilderness.

This property currently has 51 well-designed rooms and suites. You get comfortable and spacious cabin-type rooms made of wood that give off an elevated, cozy lodge feel. Upgraded recently, you will also enjoy its riverside restaurant, a lounge and bar, a game room, and solid massage facilities.

But you don’t book Rangá just for the room. You book it because it offers one of the best, unobstructed views of the Northern Lights in all of Iceland.

The hotel even features its own high-tech astronomical observatory. The best part? You can request a wake-up call so you never miss the Aurora Borealis. When the sky lights up, the front desk rings your room, so you can stumble out in your pajamas and watch the magic happen.

You will also get views of Mt. Hekla as well as the Westman Islands and some of the coolest glaciers.

Click here to check prices for your dates.

Arnanes Country Hotel

For the Arnanes Country Hotel in Höfn, you have to love how simple and minimalist it is. There may be a lot of hotels in Iceland that are similar, but Arnanes is definitely my favorite for an authentic, budget-friendly experience.

This hotel showcases breathtaking views of the Vatnajökull glacier. And, because of it being in the countryside, you can expect nothing but the most stunning views of the Northern Lights.

Their rooms are of cabin type made (of course) of wood. However, you will still enjoy modern amenities like TV and WiFi.

They also serve complimentary breakfasts, and have rooms made for the solo travelers as well as for families. There are also lots of nearby go-to places that I’d like to recommend (among others):

• Höfn swimming pool
• Hoffellsjökull glacier
• Vatnajokull National Park
• Jokulsarlon Glacier Lagoon

If you are looking for a grounded, worthwhile stay while you’re in Iceland, I strongly suggest you consider Arnanes. It’s simple, it’s minimalist in its offerings, and it gives you access to sightseeing that is surely worth remembering.

I know I would happily book it again.

Click here to check prices for your dates.

Eldhestar Hotel

Perhaps one of the most tranquil and eco-friendly hotels in Iceland, Eldhestar Hotel kinda feels like taking a step back from the luxurious Ranga Hotel.

It provides your stay with some country feels highlighted by their famous horse trekking adventures, taking you for a spin with nature.

It is located in between southern Iceland’s volcanic mountains and hidden valleys. You can choose to go the green hills surrounding Hengill volcano or a ride at Ölfusá delta islands. Not only nature, but their accommodation is highly excellent as well.

There are 36 twin rooms and a family room – all with a nice bedroom, TV, WiFi and access to its beautiful garden as well as hot tubs.

As I mentioned, you can choose from a variety of horse trekking tours, all accompanied, of course, by seasoned tour guides. This includes (half-day and full-day) tours to the Blue Lagoon and Gullfoss and Geysir, just to name a few.

Country, horse riding and leading the way in environmental awareness among all hotels in Iceland. What more could you ask for? Eldhestar Hotel is definitely a go-to place to stay in Iceland.

Click here to check prices for your dates.

5 Million Star Hotel aka Buubble

Now when it comes to unique and interesting hotels in Iceland, it doesn’t get more epitomized than when you are in 5 Million Star Hotel. Do you want to sleep in a bubble and get in touch with the wonders of nature?

Well that’s the kind of experience you will get when you sleep a night or two at 5 Million Star Hotel.

I’ve been fascinated with this hotel for years. So what happens is, you’ll be sleeping in these transparent “bubbles” that are secluded in natural places. Each bubble can accommodate two adults and one child.

The bubbles are inflated and well-ventilated – with air being renewed inside the bubble several times in an hour. The shower and comfort rooms are publicly shared in a service house, including a self-service kitchen.

The 5 Million Star Hotel is really unique! Aside from the hotels that I’ve mentioned above, it also gives you a really great opportunity to witness the awesomeness that is the Northern Lights.

And, because it is secluded in nature, you get the feels of relaxing in the wilderness, all while experiencing the comforts of their well-ventilated bubbles that happen to be outfitted with electricity and heat, so you have no reasons to complain.

It doesn’t get more unique than that, if you ask me!

Click here to check prices for your dates.

Panorama Glass Lodge

If you want an experience that truly dominates your social media feed (and your memory forever), you should book your stay at the Panorama Glass Lodge. These are individual, adults-only chalets located about a 20-minute drive north of Hella.

The standout feature is exactly what the name suggests: the bedroom is entirely enclosed in glass, so you have an amazing panoramic view of the surrounding nature.

I can tell you right now that sleeping under a clear glass ceiling while surrounded by the stark Icelandic tundra is completely surreal. You get an unobstructed, panoramic view of the sky right from your bed and if the Northern Lights show up, you are literally in the front row.

The amenities hold up to the high price tag. Each lodge comes with a private outdoor hot tub, a hammock, and a terrace equipped with a Weber grill. They even added glass saunas recently.

Tip: Book this one well in advance because it sells out incredibly fast.

Click here to check prices for your dates.

Also read: Where to Stay in Iceland (for even more, albeit traditional, hotels, and various other recommendations for choosing your base).

Torfhús Retreat

This property is built to look exactly like a traditional Icelandic Viking settlement, while offering all the modern amenities you might want.

Still, the roofs are made of living turf, and the structures are crafted from reclaimed wood and local stone. From the outside, it looks like a piece of history.

But step inside, and you are hit with complete eco-luxury. The rooms have high-end furnishings, a beautifully rustic aesthetic, and you also get a private, geothermally heated basalt stone pool right outside your door.

The food here is also spectacular, focusing on locally sourced ingredients that give you a real taste of the island. Being so close to the Geysir Hot Springs and Gullfoss waterfall makes it an ideal, premium basecamp for exploring the Golden Circle.

Click here to check prices for your dates.

Final Thoughts

I am honestly a bit sad that I have to limit this list to just my top choices. Clearly, Iceland has a lot more to offer when it comes to jaw-dropping places to stay. But there you have it, these six properties are my absolute top recommendations for the year.

And if you want to learn even more about Iceland and what to expect during your visit, I strongly recommend reading about the Cost of Living in Iceland and even my guide to moving to Iceland because, after visiting, you will most likely fall in love irremediably with this country.

Do you agree with the list? What are the other beautiful hotels that I may have missed out in this article?