By Chris Ayliffe, Arctic Meta
There’s a reason Iceland is often seen as the set of the next sci-fi classic, or a dark version of the Tolkien series (at least to me).
South Iceland especially seems custom-designed to spark stories of shadowy creatures, ancient spirits, and mysterious happenings.
Jagged cliffs, black sand beaches, misty waterfalls, and lava fields that stretch for miles without a soul in sight.
It’s not hard to imagine something watching you from behind a moss-covered rock, that isn’t just your quirky tour guide, or partner who’s seen too many prank Facebook reels (naming no names).
This part of the country has given rise to some of Iceland’s spookiest, strangest, and most enduring folklore.
And if you’re staying at the Panorama Glass Lodge in one our South Iceland location, nestled in the middle of this eerie beauty, you’re already on haunted ground.
Don’t worry, the ghosts are friendly, at least most of the time.
Why Icelandic Folklore Is So Uniquely Spooky
Iceland’s isolation breeds imagination, and you can probably easily tell how the solitude and wild weather gave rise to some of the classic stories I’m about to unveil (picture yourself in an old turf house…but try not to think of the smell of the sheep keeping you extra warm!)
When you live on the edge of the Arctic in a land shaped by volcanoes, glaciers, and long winter nights, strange stories practically write themselves.
Add in a blend of Norse mythology, Celtic influence, Christian reinterpretation, and a dash of pagan tradition and you get a folklore cocktail strong enough to give anyone goosebumps (I just gave myself some writing this).
It’s not just entertainment, it’s survival wisdom, ancestral memory, and environmental respect wrapped in a ghost story.
And unlike your mate’s dodgy story about a haunted hotel in Brighton (perhaps that’s just one from my youth), Icelanders really do believe some of these things might be true.
Meet Iceland’s Most Famous Trolls and Giants
These aren’t your average storybook giants.
In Iceland, trolls and giants are woven into the very shape of the land. They are frozen into sea stacks, buried beneath volcanoes, and echoing through legends that are still told over dinner (assuming there is no incredibly important Handball game scheduled).
They don’t just haunt the imagination; they haunt actual coastlines, cliffs, and caves, providing the setting to make the Blair Witch Project seem like a Disney classic.
South Iceland in particular is said to be one of their favourite stomping grounds, until, of course, the sun comes out (I’ll explain later).
Here are a few of the most notorious local legends, ready to meet you (preferably after sunset).
The Sleeping Giant of Hekla
Mount Hekla has long been feared as a gateway to hell (as has Dimmuborgir up north, and I’m sure many a mother-in-laws house over the centuries will be considered this also).
Some believe a troll or ancient being sleeps beneath it, one who occasionally stirs, causing the volcano to rumble and spit fire.
Many locals whisper that Hekla is not just a volcano, but a cursed giant forced into eternal slumber.
You can spot the peak from the Panorama Glass Lodge in our South Coast locations, as it seems menacingly in the distance.
Just don’t say anything rude about it. It’s listening.
Reynisdrangar: The Trolls Trapped in Stone
Those towering sea stacks off Reynisfjara beach?
They’re trolls.
Well, they were trolls.
According to legend, they tried to drag a ship to shore before sunrise but didn’t make it in time.
The sunlight, as a result, turned them into stone (classic, I know).
Now they stand frozen mid-fumble, just offshore from one of Iceland’s most and most popular beaches.
Visit the area from your South Iceland base. A place where if the waves don’t get you, maybe the trolls will.
The Giantess of Dyrhólaey
This windswept promontory isn’t just a pretty view.
It’s said to be home to a sorrowful giantess who still weeps for her lost love, throwing herself into the sea during storms. You can probably tell by now that most Icelandic storytelling involved one tragedy or another.
You might hear her wails on a blustery night while soaking in your private hot tub.
Romantic, right?
Bárður Snæfellsás (The Half-Troll Protector of the West)
OK, he’s not technically from the south, but we’ll allow it.
Bárður Snæfellsás is a half-man, half-troll guardian of the Snæfellsnes Peninsula, home to our West Iceland lodges (yes, we’ve got you covered).
He’s said to protect the mountains, punish wrongdoers, and occasionally appear to worthy travellers.
If you see a glowing figure on the glacier, maybe just say thanks and carry on.
Haunted Places of the South Coast
South Iceland isn’t short on beauty, but with that beauty comes a shadow.
It’s a part of the country where the line between natural wonder and the supernatural blurs like mist on the surface of a hot spring.
These are the kinds of places where a cold breeze on your neck could be the wind, or perhaps something else (I refer to the Facebook reel obsessor vs ghost/troll/hidden person again).
From haunted waterfalls to eerie valleys where voices ride the wind, this stretch of coastline is a paranormal playground for those brave enough to explore.
The Ghost of Skógafoss
Behind one of Iceland’s most iconic waterfalls lurks a restless spirit.
Long before Skógafoss became a magnet for photographers and Instagram reels, it was already infamous in Icelandic lore.
According to legend, a Viking settler named Þrasi Þórólfsson hid a chest of gold behind the powerful cascade.
However, he didn’t just stash it and walk away. Instead, he cursed the hoard, declaring it would never be taken by mortal hands (a bit dramatic in my opinion, but this was before banking).
Over the centuries, many tried their luck.
One young farm boy reportedly managed to catch a glimpse of the treasure and even grab hold of its handle.
But the ghostly guardian of the chest appeared, dragging the chest back into the waterfall’s depths.
All the boy recovered was the handle, which now rests in the Skógar Museum, a tangible piece of the tale, as if Iceland needed any more reasons to give museums creepy artefacts.
Today, the cave is hidden, the treasure remains untouched, and the spirit is said to still guard the site.
If you find yourself wandering too close behind the mist curtain of Skógafoss, you might hear whispers in the roar. Or feel that you’re not entirely alone.
Don’t go poking around behind waterfalls, folks, no matter what TLC told you.
You never know when a Viking ghost might be on lifeguard duty.
The Screaming Woman of Seljavallalaug
This secluded hot spring has a dark past.
Nestled in a narrow valley, Seljavallalaug is one of Iceland’s oldest swimming pools, nestled in the mountain side near the famous 2010 erupting volcano of Eyjafjalljökull (take a moment to remember that the name is not a wifi password).
It was built to bring warmth and leisure to a remote region, but the warmth hasn’t chased away all the chills.
Local folklore tells of a young woman who drowned here in the early 20th century, her spirit now bound to the pool by grief or unfinished business.
Some claim she was a visitor who slipped in unseen, while others say she was pushed by something not quite human.
To this day, hikers and bathers report strange sensations, such as sudden shivers, water rippling without wind, or the sense of being watched from the mountainside.
A few even say they’ve heard a woman crying when storms roll down the valley.
Planning on bathing alone here at night? You’re a bit of a legend, but it’s a bold choice.
Bring a towel… and maybe a priest.
Or at least don’t turn your back on the pool for too long.
The Restless Spirits of Hjörleifshöfði
This solitary headland near Vík is ancient, and is nowadays more commonly known as either an obscure puffin spot, or the Yoda cave.
Known as Hjörleifshöfði, it rises dramatically from the surrounding black sands, a geological island in a sea of ash and myth.
Named after one of Iceland’s earliest settlers, the area is steeped in history and sorrow.
It’s said that Hjörleifur was murdered by his own slaves, who fled to the nearby Westman Islands, only to be pursued and killed by his brother Ingólfur Arnarson, the man who would go on to found Reykjavík (he was a mixed bag of a character as you can imagine).
The headland carries the weight of this violent tale, and some say the land has never quite settled.
Walkers often report an uneasy silence that seems to deepen the closer you get to the old burial mounds.
On overcast days, the landscape looks haunted, and more than one visitor has claimed to hear voices carried on the wind, or seen flickering lights weaving through the rocks at dusk.
It’s a captivating spot for a dramatic hike, especially if you fancy telling ghost stories later from the warm comfort of your glass cabin (the best place for a modern day storytelling on a trip to Iceland).
The Phantom Horseman of Mýrdalur
Locals near Mýrdalur have long reported the unnerving sound of hoofbeats slicing through the night air.
There’s no horse, no rider, and no sign of where the galloping begins or ends (much like an Iceland Uber driver, it never turns up…Also, we don’t have Uber here).
Just the rhythmic pounding of invisible hooves tearing across empty fields.
According to legend, it’s the ghost of a rider who vanished centuries ago during a blizzard, lost while trying to deliver a message to the coast.
Some say he was a scout, whilst others claim he was fleeing justice, either way, his final journey never ended.
The phantom horseman is said to ride eternally through Mýrdalur’s foggy pastures, cursed to search for a destination he’ll never reach (must be using Apple Maps).
Some nights, the hoofbeats pass quickly and fade.
Other times, they circle closer, louder, as if he’s looking for someone.
Seeing him is rare.
But hearing him?
Well, that’s much more common.
Especially if you’re staying somewhere nearby with views over the open fields.
Chilling Tales from Icelandic Folklore
Not every ghost story in Iceland belongs to a single place.
Some travel with the wind, passed from one fjord to the next, whispered between generations around kitchen tables and campfires.
These are the tales that shape how people interact with the land, with caution, reverence, and a healthy dose of side-eye when a shadow moves where it shouldn’t.
They’re not just old wives’ tales, instead they’re part of the national identity.
Here are a few that still give locals the shivers (and might make you leave a night light on in your glass lodge).
The Djákninn á Myrká (The Deacon of Dark River)
This guy is Iceland’s most famous ghost.
Known as the Deacon of Dark River, he was once a charming clergyman who fell in love with a woman named Guðrún.
Tragically, while riding his horse to visit her one snowy Christmas Eve, he fell into a frozen river and drowned (yes, the theme continues).
But love doesn’t check the pulse.
The deacon showed up at Guðrún’s home anyway, dripping wet, eerily silent, and conspicuously missing his head (it happens).
He spoke in fragments, never using her full name, which in Icelandic folklore is a dead giveaway that you’re dealing with someone… well, dead.
When he tried to take her back with him (presumably to his not-so-cozy grave) Guðrún escaped by the skin of her teeth.
She later needed help from a priest to banish him for good.
The tale is still told today as a chilling reminder to be careful who you agree to meet on Christmas Eve.
Especially if they show up headless and mute (it’s a bad Tinder date if nothing else).
The Witch of Jökulsárlón
They say a witch used to live by the glacial lagoon.
Not the bubbling-cauldron, broomstick type, this was the Icelandic variety: silent, formidable, and rumoured to command the weather itself (closer to Storm from the X-Men).
She was said to have lived in solitude along the edges of Jökulsárlón, where she would chant in the ancient tongue and stir the waters with her words.
Locals feared her, but some also sought her help for healing, foresight, or to ward off misfortune.
But when she died, the lagoon didn’t forget her.
Now, travellers speak of sudden mists that creep across the lake without warning, or the feeling of being watched as they admire the drifting icebergs (this could also just be the nosy Seals or occasional drifting Walrus).
Some even claim to hear faint singing echoing off the glacial walls.
Her ghost, they say, still wanders the lagoon; though not angry, just waiting.
For what, no one dares guess.
The lagoon itself is a great backdrop for your Northern Lights photo — if you’re not afraid of photobombing spirits.
Katla the Cursed Nun of Mýrdalsjökull
Katla was a nun with a temper, and not the holy water kind.
She served at a convent near Mýrdalsjökull, a glacier as infamous as it is icy (spoiler: the massive volcano beneath the glacier is called Katla).
When a stable boy crossed her, the details of which differ depending on who’s telling the tale, Katla reportedly snapped.
In a rage, she killed the boy and fled into the glacier to avoid capture, vanishing without a trace.
But Iceland has a way of holding onto energy, especially the dark kind.
It’s said she melted into the glacier itself, fusing her spirit with the ice.
Now, every time the Katla volcano rumbles or erupts, locals say it’s her fury breaking through the frozen crust.
The region can be unpredictable, explosive, and cloaked in fog, a fitting monument to a woman who became legend by refusing to repent.
So yes, maybe don’t badmouth nuns while driving near Vík.
Especially ones with lava in their veins.
The Sea Monster of Lagarfljót
OK, East Iceland sneaking in here (cool to know if you’re planning the Ring Road though).
Lagarfljót lake, long and misty, is said to be home to a terrifying sea serpent known as the Lagarfljótsormurinn.
Described as a massive, wormlike creature (a poor mans Loch Ness monster, in my view, having once lived in Scotland) with humps rising from the water like a twisted spine, it’s been terrifying locals for centuries.
The first recorded sighting dates all the way back to 1345, which means this thing has a longer track record than most family trees.
The legend goes that a girl placed a tiny worm on a gold ring to make her treasure grow.
It worked, and a little too well.
The worm grew so large and menacing that it had to be cast into the lake, where it continued to thrive… and presumably hold grudges.
Sightings have come and gone for generations, from farmers spotting it slithering through the water to more recent video footage sparking international headlines and Loch Ness-style debates.
Locals still swear it surfaces now and again, especially when the weather shifts or something disturbs the lake.
So if you’re cruising through East Iceland, or heading to the Hengifoss hike, and see something serpentine and suspicious paddling your way, maybe just keep driving.
Elf Rocks, Hidden Folk & Unseen Worlds
Just because you can’t see them doesn’t mean they’re not there (the same mantra I remind myself every month before the mortgage payments come in).
In Iceland, the hidden world hums quietly beneath the surface, in the cracks of lava fields, the shadows of cliffs, and the silence between gusts of wind.
These stories don’t belong to the past.
They’re living myths, reinforced by real decisions and whispered warnings.
Here’s where folklore meets everyday life, and where your curiosity might just earn you an unexpected guest.
The Belief in Huldufólk: Iceland’s Hidden People
These aren’t Santa’s little helpers.
Huldufólk look like us but live in a parallel world, often inside boulders, cliffs, or hills (sadly, Stephen Hawking didn’t give us a real theory to scientifically grant grounding to these Icelandic claims…bit late now).
They’re shy, secretive, and serious about property rights.
They’ve been blamed for everything from broken machinery to mysteriously thriving crops, and it’s not uncommon for Icelandic road projects to be paused or redirected to avoid disturbing their supposed homes.
Construction crews have even brought in “elf communicators” to negotiate safe passage (I’m not sure how you get an MSc in Elf Comms but here we are).
It’s a strange but accepted part of local culture, one where folklore isn’t just a story, it’s part of the planning process.
Where Not to Build: Cursed Rocks Near Hvolsvöllur
Cutting to the chase, a farmer tried to move a rock.
His tractor broke, his sheep vanished, and he apologised with cake.
Locals had warned him the rock was home to huldufólk, but he didn’t listen until things started breaking and disappearing.
Some say even the replacement parts he ordered arrived faulty, as if the elves were tampering with the post (someone is, because it is indeed very slow).
It wasn’t until he baked a traditional Icelandic kleina, left it on the stone with a whispered apology, and avoided the area entirely that the strange events stopped.
Moral: don’t mess with rocks that look slightly smug (one to share with the Scouts in Iceland).
Or better yet, stick to staying somewhere fully approved by the elves, like the Panorama Glass Lodge (just saying!)
Tales of Disappearing Travellers and Elf Mischief
People have vanished.
Walked into mist and never returned.
Some say the hidden people took them.
Others say they simply stepped off the path.
In some older tales, the missing were found years later, unchanged in age and unsure how much time had passed.
A few returned with stories of glowing feasts, strange music, or promises they couldn’t explain.
Others never returned at all.
Either way, it’s best to stay close to your lodge when the fog rolls in, or you might miss the next World Cup (oh and your wife/husband and kids).
Modern Encounters: Locals Still Tell These Stories
Some stories refuse to stay in the past.
They echo in the present, lingering like steam on a cold morning at Geysir.
Ask around and you’ll hear them, half-laughed confessions over coffee, strange dreams shared in hushed tones, or odd events written off with a shrug and “that’s just Iceland.”
These encounters remind us that folklore isn’t frozen in time.
It walks beside us, quietly keeping score and waiting for the right moment to come back to the fore for each individual.
A Farmer’s Story Near Flúdir
One man claims he saw small figures dancing on his field.
It was just before sunrise, a time when huldufólk are said to be most active.
He described them as barely knee-high, glowing faintly, and moving in slow, deliberate circles through the mist.
Soon after, his tractor wouldn’t start, the sheep refused to graze, and his tools mysteriously shifted locations overnight (a bit close to the plot of Paranormal Activity…if it was on a farm).
Following the advice of an elderly neighbour, he left a bowl of cream and a slice of warm rúgbrauð by the edge of the field.
The next morning, the bowl was clean, the tools were back in place, and the tractor roared to life.
Since then, the crops in that spot have grown twice as fast as elsewhere on the farm.
Coincidence?
Sure. Probably.
But he still leaves offerings every month, just in case the little dancers return (I could really use that sort of help for travel writing).
Paranormal Reports Around Þórsmörk
Hikers hear drums at night.
Not the kind you’d expect at a festival, but slow, rhythmic pounding that echoes through the valleys, oddly ancient sounding and out of time.
Some believe it’s the sound of long-lost rituals still carried out by unseen beings deep in the highlands.
Some report dreams that feel oddly real.
One traveller said she woke up in her tent speaking a language she didn’t recognise.
Another claimed he dreamt of an old woman in traditional Icelandic dress warning him to leave an offering, only to find a cairn built outside his camp the next morning (yes, very Blair Witch, and it creeps me out even when I write it).
Others say they’re watched, that uncanny sense of being observed from behind the trees or over the ridge.
Even highly experienced guides admit the Þórsmörk valley holds an energy they can’t quite explain.
The mountains don’t forget.
And in Þórsmörk, they might just remember you (if you’ve learned anything from these tales, always leave an offering of some local bread…maybe not from Bónus as these beings seem fussy).
Ghost Sightings Near Abandoned Farms
Empty farms across the south attract ghost hunters.
Often left untouched for decades, these abandoned homesteads are more than just relics of Iceland’s rural past, they’re also well-known hotspots for strange occurrences.
Visitors have reported doors slamming in windless weather, old radios crackling to life without power, and inexplicable cold spots lingering in certain rooms. The perfect place for some of those ridiculous ghost hunter shows, which are almost always based in the US!
Some guests claim to see shadowy figures through broken windows or hear footsteps on floors that should be empty.
There are stories of glowing lights flickering in barns, as if someone (or something) is still working late.
Some visitors leave spooked, others… don’t leave at all.
I’m joking, of course…. Mostly.
How to Explore These Legends on Your South Iceland Trip
Want to experience these crazy happenings for yourself to test if these old tales are true?
Start by staying somewhere surrounded by nature, with nothing but the sky and lava fields for neighbours, like the Panorama Glass Lodge.
Visit places like Skógafoss, Dyrhólaey, or Seljavallalaug.
Join local folklore tours, chat to locals in Vík, or hike in the surrounding area.
Just remember to tread lightly.
You never know whose toes you might step on (hopefully not an non-petrified trolls!)
Sleep Among the Legends: Stay at Panorama Glass Lodge
If you’re going to surround yourself with spooky stories, you might as well do it in total comfort.
At the Panorama Glass Lodge, you’re not just visiting the world of folklore, you’re sleeping in the middle of it.
Glass walls, private hot tubs, panoramic views of mythical landscapes, that makes you feel close to the nature and stories of Iceland’s ancient past (with luxury linen and floor heating).
This is your front-row seat to a world where trolls might still stomp past your cabin and elves watch from the rocks, hoping you have an offering or two (which you can now make at our local elf house onsite).
But don’t worry, we’ve upgraded from sheep skins and saga scrolls to high-thread-count sheets and Bluetooth speakers (the Huldufólk approve).
Final Thoughts: Iceland’s Ghosts Aren’t Just Stories
These aren’t just old tales once told to pass the time during a a snow storm in a Viking Turf house.
They’re maps of meaning, forming a strong part of Iceland’s cultural tapestry.
They show how deeply Icelanders respect the land, the unseen, and the wild unknown.
So come stay at the Panorama Glass Lodge.
Sleep beneath the stars.
Soak in nature.
Listen closely.
Because in Iceland, silence speaks volumes.
And sometimes, that rock really is watching you.