The settlement of Iceland is generally believed to have begun in the second half of the 9th century with the Viking expansion and was lead by a viking called Ingólfur Arnarsson.

Norse settlers migrated across the Ocean due to various reasons, one of them being a shortage of arable land in their native Scandinavia. Another reason was the harsh reign of Norse king Harald the Fair-Haired. By then, Iceland was still unsettled land and could therefore be claimed without battling potential inhabitants.

Generally, the year AD 874 is considered to be the initial year of permanent settlement and historians refer to the Icelandic Age of Settlement (Landnámsöld) for the period of 874 to 930, at which point most of the island had been claimed and the Icelandic parliament (Alþingi) was founded.

The oldest relics giving proof of human habitation which have been dated with certainty are wall fragments found in Reykjavík and Krýsuvík (southwest Iceland).

The walls were built before the so called Settlement Layer was deposited. The Settlement Layer refers to a specific layer of tephra, a fragmental material produced by volcanic eruptions, distributed by an eruption in the Torfajökull region, which has been dated to 871 AD ±2 years.

However, it is impossible to tell whether the walls were built shortly before the volcanic eruption, or several decades before. Hence it is possible that people were living in Iceland earlier than AD 871 but as early as AD 850.

Almost the entire knowledge about the Icelandic Age of Settlement is drawn from two medieval manuscripts: the Íslendingabók (The Book of Icelanders) by Ari Þórgilsson and Landnámabók (The Book of Settlement) giving detailed accounts of the settlement and its settlers.

Before the establishment of permanent settlements in Iceland, there were a few attempts to do so beforehand.

The medieval chronicler Ari Þórgilsson, author of the Íslendingabók, stated that Papar, Irish monks and hermits, had been in the country before the Norsemen. Ari wrote they left because they did not want to live amongst the newly arrived pagans. Little evidence of those monks is to be found. It is sure, however, that the Irish monks didn't intend to permanently settle in Iceland.

The first Scandinavian having set foot on the island was the Norwegian Naddoður Ásvaldsson. Said Naddoður was en route from Norway to the Faroe Islands but drifted off course and reached unknown shores. He and his men went on land in Reyðarfjörður in the East of Iceland, climbed up a near mountain to look out for inhabits but found the land unoccupied.

Naddoður only spent the summer in the unfamiliar territory and prepared to leave in the fall. Just as he was sailing away, it started snowing. Thus he named the country Snæland (Snowland). Shortly afterwards, sometimes in the 860s, the Swede Garðar Svavarsson was on his way from Sweden to the Hebrides when he, too, was blown off course and reached East Iceland. He and his men circumnavigated the landmass to establish it was an island and eventually went ashore at the North coast at Skjálfandi Bay. Garðar and his crew built a house and the place is since called Húsavík (Bay of Houses).

The vikings stayed for one winter, for unknown reasons they abandoned their settlement the following summer and left never to return. Garðar Svavarsson named the newly-conquered land after himself Garðarshólmur (Garðar's little island). One of his men, Náttfari, stayed behind with two slaves and settled in what is now known as Náttfaravík (Bay of Náttfari). The Book of Settlement, however, claims that said Náttfari was not a permanent settler.

The third viking arriving in Iceland before AD 871 was Norseman Flóki Vilgerðarson. There was a man by the name Flóki Vilgerðarson. He was a great Viking. He left to find Garðarshólmur states The Book of Settlement.

Unlike his two predecessors, Flóki set out with the intention to settle Garðarshólmur. According to the story told in Landnámabók, Flóki took three ravens to help him find his way. Thus, he was nicknamed Hrafna-Flóki (Raven- Flóki). Flóki set his ravens free near the Faroe Islands. The first raven flew back on board, the second flew up in the air and then returned to the ship. However, the third bird flew in front of the ship leading the crew to Iceland.

Hrafna-Flóki's vessel passed what is not Reykjavík when one of his men, Faxi, noted that they seemed to have found great land. The bay facing the capital is therefore called Faxaflói, Faxi's Bay, in his name.

Hrafna-Flóki and his crew went ashore in Vatnsfjörður in the Westfjords. During a harsh winter the settlers' entire livestock died and Flóki angrily renamed the land Ísland (Iceland). Despite their troubles finding food, the settlers stayed another year but finally gave up and returned to Norway.

Flóki would return much later and settle in what is now known as Flókadalur (Flóki's Valley).

The first settler, who establish permanent settlements and is considered the first settler of Iceland was before mentioned Ingólfur Arnarsson.

The Book of Settlement contains a long story about Ingólfur's colonization efforts. According to the book, Ingólfur had to leave his native country Norway after becoming involved in a blood feud.

News of the new land had travelled to Scandinavia, so he and his step brother Hjörleifur Hroðmarsson sailed for Iceland. When land was in sight, Ingólfur threw the pillars of his high seat (a sign of his being a chieftain) overboard as it was the tradition and promised to settle where the Gods decided to bring them ashore. He sent out two of his slaves, Vífill and Karli, in search of the pillars.

Locating the pillars took three years, which Ingólfur spent at a place he named Ingólfshöfði (Ingólfur's Headland), at his step brother's place and below Ingólfsfjall (Ingólfur's Mountain).

Finally, the pillars were found in Faxaflói Bay at a hill side. Ingólfur and his crew moved there and built the first permanent settlements of Iceland. Due to the smokey sulfur springs he found in the area, Ingólfur named the place Reykjavík (Smokey Bay).

The hill side, were the pillars are said to have washed ashore, is now at the heart of Iceland's capital and enthroned by a statue of its founder Ingólfur.

The remains of an old Viking long house of that time, dated back to AD 871, can still be found in downtown Reykjavík.

Ingólfur was followed by hundreds of settlers, Landnámabók lists 435 men, the majority of them settling in the northern and southwestern parts of the island.

Within a period of about sixty years all the usable land had been taken.The Book of Settlement mentions about 1,500 farm and place names as well as more than 3,500 people.

The reason why Ingólfur is considered to be the first settler initiating Iceland's colonization and none of the other settlers before him, is because he was the first to sail to island with the express purpose of settling the land and succeeding in making a permanent home there.