Cheap Food in Reykjavik: 10 Best Budget Eats for 2026

Reykjavik has a reputation as one of Europe’s priciest cities, and it earns it. But cheap food in Reykjavik does exist if you know where to look, and you can eat well without a huge dinner bill. This guide covers ten budget spots, many serving traditional Icelandic flavors. I saved my favorite for last, a unique spin on a traditional hot dog.

Best Traditional Icelandic Food in Reykjavik: Kaffi Loki

This is not the cheapest food in Reykjavik, but it’s one of my favorites, especially for the view from the upstairs room (I called ahead to secure a spot). Kaffi Loki is across from the famous church, Hallgrímskirkja. Kaffi Loki specializes in traditional Icelandic dishes. Some plates are pricey, but the rye bread ice cream, the small plates, and the simple sandwiches are affordable ways to try local flavors. It’s one of the easiest places for a visitor to sample Icelandic food, rye bread, smoked lamb, even fermented shark if you’re brave, in a casual café setting.

What to Order: The rye bread ice cream, or a small-plate sampler of Icelandic classics.
Best If: You want to try traditional Icelandic food without a full fine-dining bill.
Skip If: You’re squeamish about strong flavors. Some Icelandic classics are an acquired taste.

Best Fish Soup in Reykjavik: Reykjavik Street Food

Reykjavik Street Food serves Icelandic comfort dishes at fast-casual prices, and the fish soup is the best order. It’s creamy, generously portioned, and one of the better budget meals in the city, especially in cold weather. The menu also covers plokkfiskur, the Icelandic fish-and-potato mash, and lamb soup. This is warm, filling food served quickly, without the formal restaurant prices.

What to Order: The fish soup, or the plokkfiskur if you want a classic Icelandic fish stew.
Best If: You want hearty Icelandic comfort food on a cold day without a big bill.
Skip If: You want a formal, sit-down meal. This is quick and casual.

Best Cheap Soup and Stew in Reykjavik: Icelandic Street Food

Not to be confused with the spot above, Icelandic Street Food features soups and stews, and the free refills make it a great value in central Reykjavik. The lamb stew and the seafood soup are the best. Order it served in a bread bowl if you want something extra hearty. The space is casual and friendly.

What to Order: The lamb soup or seafood soup, with the free refills and bread.
Best If: You want to eat until you’re full for a single low price, Icelandic-style.
Skip If: You want variety on the plate. This is soup-and-stew done well and cheap.

Best Cheap Noodle Bowl in Reykjavik: Noodle Station

Noodle Station is a Reykjavik institution for low-cost, filling meals, with three types of noodle soup all under about 2,000 ISK (about 14 USD). It’s fast, consistent, and a reliable fallback when you want something warm and cheap in the centre.

What to Order: The beef noodle soup, the biggest and most satisfying bowl on the menu.
Best If: You want a hot, filling bowl for well under the usual Reykjavik price.
Skip If: You want Icelandic specialties. This is Thai-inspired noodle soup, not local cuisine.

Best Cheap Sandwiches in Reykjavik: Hlöllabátar

Hlöllabátar is a downtown institution for hoagie-style sandwiches loaded with meats, sauces, and vegetables on soft warm bread. The portions are big, the prices are low, and it stays open late, so it works after a night out as much as a midday meal. A 12-inch sub with chips will feed you well for less than most sit-down lunches in the city.

What to Order: The Hlölli special, or any 12-inch sub with a side of chips.
Best If: You want a big, cheap, filling sandwich, day or late at night.
Skip If: You’re after something light or refined. These are hearty, no-frills subs.

Best Fish and Chips in Reykjavik: Fish & Chips Vagninn

Fish & Chips Vagninn is a red food truck at the west end of the old harbour, run by a family that owns its own fishing vessels, so the cod is often caught hours before it hits your plate. The batter is crisp, the chips are thick, and the tartar sauce is outstanding. Eat it on a harbour bench with a view of the water. It’s affordable seafood by Icelandic standards, and the freshness shows.

What to Order: The classic fish and chips, and don’t skip the tartar sauce.
Best If: You want the freshest budget seafood in the city, enjoyed by the harbour.
Skip If: You need indoor seating. This is a food truck with benches, and the weather is the weather.

Best Food Hall in Reykjavik: Hlemmur Mathöll

Hlemmur Mathöll is Iceland’s first food hall, in a former bus terminal on Laugavegur, with a spread of stalls under one roof. You’ll find tacos, Neapolitan pizza, Vietnamese, Icelandic lamb, gelato, and the excellent Brauð & Co bakery. It works for groups or anyone who wants variety at mixed price points, and you can build a cheap meal by grabbing two small dishes from different stalls. The seating is shared and the atmosphere is laid back.

What to Order: Two small plates from different stalls, plus a cinnamon bun from Brauð & Co.
Best If: You’re in a group with different cravings, or you want variety without committing to one spot.
Skip If: You want a quiet table for a proper sit-down dinner. It’s communal and busy.

Best Bakery Breakfast in Reykjavik: Deig

Deig is the best spot for doughnuts, bagels, and pastries at prices that count as budget by Reykjavik standards. The bagel sandwiches are hearty enough for a full breakfast or a mid-day refuel, and the doughnuts make a nice sweet treat. It’s an easy, cheap way to start the day before exploring without a hotel breakfast bill.

What to Order: An everything bagel sandwich, or a doughnut if you’re after something sweet.
Best If: You want a filling, cheap breakfast or snack on the go.
Skip If: You want a sit-down breakfast with table service. This is a quick counter stop.

Best Fries in Reykjavik: Reykjavik Chips

Reykjavik Chips does Belgian-style fries with a long list of sauces, and it’s a simple, cheap, and filling snack or light meal. The portions are big enough to share, and the garlic sauce is the most popular one for a reason.

What to Order: A cone of fries with garlic sauce.
Best If: You want a cheap, hot, shareable snack while exploring downtown.
Skip If: You want a balanced meal. This is fries and sauce, nothing more.

Best Cheap Food in Reykjavik: Bæjarins Beztu Pylsur

Bæjarins Beztu Pylsur is the famous hot dog stand near the harbour, which has been going strong since 1937 and is still family-run into its fourth generation. The Icelandic pylsur is made with a mix of lamb, beef, and pork, which gives it a rich flavor, and at around 880 ISK (about 6 USD) it’s the cheapest classic in the city.

🏆 My Personal Pick

It’s all about the lamb. Bæjarins Beztu is a classic spot, and it’s my pick for the best cheap food in Reykjavik. Order one with everything, which gets you ketchup, sweet mustard, remoulade, and both crispy fried and raw onions. There’s almost always a line, but it moves fast, and eating a hot dog by the harbour in the cold is an authentic Reykjavik moment. Here’s a fun bit of trivia: a hot dog with mustard only is called a Clinton, after the president ordered his that way here in 2004.

What to Order: A pylsur with everything.
Best If: You want the single most famous cheap bite in Reykjavik.
Skip If: You don’t eat hot dogs. There’s no way around what this is.

Cheap Food in Reykjavik: What to Know Before You Go

A few things make eating cheap in Reykjavik easier:

Focus on soup, fish, and hot dogs, since fish soup, lamb soup, and the pylsur are the most filling budget options in the city.
Look for free refills, since spots like Icelandic Street Food let you eat until you’re full for one price.
Use the food halls, since Hlemmur Mathöll lets you build a cheap meal from small plates across stalls.
Fill a water bottle from the tap, since Icelandic tap water is excellent and free, and bottled water is a needless expense.

Cheap Food in Reykjavik: FAQs

Is food expensive in Reykjavik?

Yes. Reykjavik is among the most expensive cities in Europe for eating out. But cheap food in Reykjavik is findable from hot dogs to soups, noodle bowls, and food-hall plates, and tap water is free and excellent, which cuts the bill further.

What is the cheapest food in Reykjavik?

The hot dog from Bæjarins Beztu Pylsur, at around 880 ISK (about 6 USD), is the cheapest classic in the city. Soups with free refills at Icelandic Street Food, noodle bowls under about 2,000 ISK at Noodle Station, and fries at Reykjavik Chips are my other budget winners.

What Icelandic food should I try on a budget?

The unique lamb, beef, and pork mixed hot dog (pylsur), fish soup, plokkfiskur (fish-and-potato mash), lamb soup, and rye bread ice cream are all traditional and affordable. Bæjarins Beztu covers the hot dog, Reykjavik Street Food and Icelandic Street Food cover the soups, and Kaffi Loki is the easiest spot for traditional dishes without a big bill.

Where to Stay in Reykjavik: My Top Picks

Budget

CityHub Reykjavik is a smart, tech-forward budget stay in the centre, with compact private rooms, a hot tub, and a social lounge. It’s an easy, affordable base within walking distance of most of the cheap eats on this list.

Mid-Range

Alda Hotel is a contemporary boutique hotel on the upper end of Laugavegur, Reykjavik’s main shopping street. It puts you in the middle of the action, with the downtown restaurants, bars, and shops right outside the door.

Luxury

Reykjavik Konsulat Hotel, Curio Collection by Hilton, is in the oldest part of the city, with boutique rooms, a wellness spa, and a well-regarded restaurant. It’s a splurge for a central, design-led stay with a bit of history.

Bonus: Blue Lagoon

The Retreat at Blue Lagoon is a big splurge but you only need one night. It’s a luxury hotel with private access to the Blue Lagoon’s geothermal waters, about 40 minutes from the city near the airport. For something special but more affordable, the Silica Hotel at the Blue Lagoon offers its own bathing lagoon and a calming stay at a lower price than the Retreat.

🍪 Final Bite

Reykjavik is expensive, but you can still eat well on a budget if you know where to go. Here’s where to start:

Get a lamb hot dog “with everything” at Bæjarins Beztu Pylsur, the city’s most famous cheap bite.
Warm up with fish soup at Reykjavik Street Food, or free-refill soups at Icelandic Street Food.
Grab a big beef noodle bowl at Noodle Station for a filling, cheap meal.
Eat harbour-fresh fish and chips at Fish & Chips Vagninn.
Build a cheap meal from small plates at Hlemmur Mathöll.
Try traditional Icelandic flavors without the big bill at Kaffi Loki.

Been to Reykjavik and found a cheap eat I should add? Tell me in the comments, I’m always adding to the list before the next trip.

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