The Best Hotels in Iceland, From Rural Lodges to Reykjavik Boutiques

"The Blue Lagoon is one of Iceland’s most illustrious attractions, with a constant stream of visitors enjoying a dip in the steamy blue water bordered by black lava on Reykjanes Peninsula. Its popularity also splits Iceland travelers firmly into two camps: those who want to stay away from the well-trodden tourist attractions, and those who embrace them wholeheartedly. Should you visit the Blue Lagoon, or give it a miss? That is the question. Perhaps an easier question to answer is whether to stay at the upscale new hotel attached to Iceland’s famed hot spring. Enigmatically named The Retreat, this hotel takes all the geothermal wonder of the Blue Lagoon and instils it into an uber-luxurious wellness establishment. The sleek and minimalist suites mirror the mossy-covered lava fields outside, while floor-to-ceiling windows welcome in the ethereal light of the Reykjanes Peninsula, inciting the stark grey and subdued black interiors into a heady and otherworldly Icelandic spectrum. Inside, all roads lead to the underground spa, a cavernous space offering the patented Blue Lagoon Ritual, a wellness cleanse using the silica, algae, and array of minerals all found in the geothermal waters. Access to a more exclusive section of the Blue Lagoon is also included, and there’s a world-class restaurant to boot." - James Taylor