Iceland’s foodie scene is the stuff of legends. Steaming bowls of lamb stew, freshly caught Arctic char, creamy skyr, and warm cinnamon buns are just a few of the specialties you can look forward to on your trip.
The good news? You don’t have to overspend to enjoy authentic Icelandic food.
If you’re planning a budget trip to Iceland or a self-drive road trip around the Ring Road, this guide covers the best cheap eats in Iceland, including budget restaurants in Reykjavík and affordable food options along the Ring Road.
How Much Does Food Cost in Iceland?
Let’s be honest: Iceland is not a cheap destination. As an island nation, many ingredients are imported, which increases food prices.
Here’s what you can realistically expect:
- Average dinner in Iceland: $40-$50 USD
- Budget meal in Reykjavík: $12-$20 USD
- Cheapest street food options: From $5 USD
- Gas station sandwich/wrap: Around $6-$8 USD
Reykjavík offers the widest range of prices, from fine dining to some of the best cheap food in Iceland. Smaller towns in North Iceland, like Akureyri, can sometimes be slightly more affordable than tourist-heavy areas in the south.
If you’re road tripping, combining grocery shopping, gas station stops, and a few classic Icelandic food experiences is the smartest strategy.
6 Best Cheap Eats in Iceland
1) Icelandic Hot Dogs at Bæjarins Beztu Pylsur
Iceland’s legendary hot dogs are one of the best cheap eats in the country.
Made primarily from Icelandic lamb and topped with raw onions, crispy onions, mustard, ketchup, and remoulade, they’re simple but iconic.
The original and most famous stand is located in central Reykjavík near the harbor. Today, Bæjarins Beztu Pylsur has several locations across the Greater Reykjavík area as well as inside Keflavík International Airport.
Price: Around $5-6 USD
If you’re road-tripping around Iceland beyond the capital region, you’ll still find excellent Icelandic hot dogs at gas stations and roadside stands, but Bæjarins Beztu Pylsur specifically is only found in the capital area and Keflavík.
Order it “with everything” for the full Icelandic experience.
2) Burgers at Aktu Taktu
Iceland no longer has McDonald’s. After the financial crisis in 2008, the last branch closed and never returned.
Aktu Taktu is often considered Iceland’s answer to classic fast food and remains one of the more affordable places to grab a filling meal in Iceland.
- Burger: Around $14 USD
- Full meal with fries and a drink: Around $20 USD
While that may sound expensive compared to other countries, it’s considered fairly affordable by Icelandic standards, especially for a complete fast food meal. For budget travelers looking for cheap eats in Iceland, this is still one of the better-value burger options.
Photo from Aktu Taktu
3) Gas Station Food Along the Ring Road
Driving Iceland’s famous Route 1? Don’t underestimate gas station food. Chains like N1, Orkan, and Olís offer surprisingly good and affordable meals.
You’ll find:
- Fish and chips
- Lamb stew
- Fresh sandwiches and wraps
- Hot dogs and burgers
- Coffee and baked goods
Sandwiches and wraps typically cost $6-$9 USD.
If you’re on a self-drive trip in Iceland, this is one of the easiest ways to eat well without spending a fortune.
photo from Olis gas station
photo from Olis gas station
4) Soup at Icelandic Street Food
Located in central Reykjavík, Icelandic Street Food focuses on traditional Icelandic recipes at reasonable prices.
- Large soup around $12 USD
They offer lobster and shellfish soup served in homemade bread bowls, this is one of the best budget restaurants in Reykjavík for warming up after exploring the city.
Photo from Icelandic Street Food
5) Pastries at Brauð & Co
This beloved Reykjavík bakery is famous for its kanilsnúðar (Icelandic cinnamon rolls).
- Cinnamon roll: Around $7 USD
- Hjónabandssæla (marriage bliss cake): Around $6 USD
Perfect for breakfast before a Golden Circle drive or as a snack on your Iceland road trip.
Bonus: It’s located just off Laugavegur, close to Bónus, one of Iceland’s cheapest grocery stores, perfect for picking up picnic supplies before heading out on a self-drive trip.
Photo from Brauð & Co
6) Sandwiches at Hlöllabátar
Located near Ingólfur Square in downtown Reykjavík, Hlöllabátar serves generous sandwiches packed with fillings like lamb, bacon, cheese, shrimp, and their signature sauce.
- Half sandwich: Around 13$ USD
- Full sandwich: Around 21$ USD
One of the best quick lunch options in central Reykjavík.
Quick Tip for Eating Cheap in Iceland
1. Shop at Grocery Stores
Stores like Bónus and Krónan are ideal for:
- Skyr
- Fresh bread
- Sandwich ingredients
- Snacks for your road trip
Grocery shopping is essential if you’re camping or driving around Iceland.
2. Combine Restaurant Meals with Road Trip food
Plan one proper restaurant meal per day and fill the rest with bakery stops, gas station meals, and groceries.
3. Travel by Rental Car
A self-drive trip gives you access to cheaper food outside major tourist hotspots and lets you stop at supermarkets along the way.
If you’re planning to explore Reykjavík, the South Coast, or drive the Ring Road, renting a cheap car in Iceland allows you to save on tours and control your food budget.
FAQ: Cheap Eats in Iceland
- Is food really expensive in Iceland?
Yes, compared to most countries. However, budget options exist, especially street food, gas station meals and grocery stores.
- What is the cheapest food in Iceland?
Icelandic hot dogs are usually the cheapest ready-made meal, starting around 700 ISK. Grocery store sandwiches and gas station wraps are also budget-friendly.
- Can you eat cheaply in Reykjavík?
Yes. Reykjavík has a mix of high-end restaurants and affordable food spots. Bakeries, soup restaurants, sandwich stops, and hot dog stands are the best options.
- Is gas station food in Iceland good?
Surprisingly, yes. Gas stations along Route 1 often serve fresh fish and chips, lamb stew, and high-quality sandwiches. Many locals eat there regularly.
- How can I save money on food during an Iceland road trip?
- Shop at grocery stores
- Bring snacks from home
- Combine bakery stops with simple meals
Plan Your Budget Foodie Road Trip in Iceland
Whether you’re tasting Reykjavík’s street food, grabbing fish and chips along the Ring Road, or stocking up at Bónus before heading into the countryside, it’s absolutely possible to enjoy Icelandic cuisine without overspending.
A self-drive trip gives you the flexibility to explore food spots beyond the most touristy areas and mange your budget smartly.
Rent a cheap car in Iceland, plan your stops wisely, and spend your savings on what really matters: experiencing the best of Iceland’s landscapes and local flavors.
