While it was a rather sleepy airport until the 2000s, the banking crisis in Iceland (which led to exchange rates favorable to tourism) as well as developments in aviation that allowed transatlantic flights on narrowbody twin jet planes with a stop in KEF have made this airport into a rapidly growing hub, especially for discount travellers and smaller cities. Both Icelandic airlines use the central location in the Atlantic for destination networks on both sides of the pond but European carriers now also link KEF to their bases on the continent.
This rapid growth means that the terminal is stretched way beyond its capacity. The airport is being expanded, but expect crowded gates and nowhere to sit. Especially since the double digits growth means one expansion is usually done two years after the next would have become necessary.
While the airport is often marketed as "Reykjavík" (no doubt in part because nobody outside of Iceland knows any other town in the country) it is actually some 50 km (31 mi) from the town and Reykjavík actually has its own airport that sees domestic flights and flights to the Faroes or Greenland. To avoid confusion, it might help to use the IATA code KEF when referring to the airport.
While this split of domestic and international airport might seem awkward and indeed is a problem for Icelanders arriving home from vacation, it gives you a good opportunity to check out the capital region before heading out on a domestic flight.
Naturally the two Icelandic airlines, Wow Air and Icelandair offer the most connections at this airport. However, there is a good selection of European and US carriers who have flights to their hubs and flights you might not even think of (Dresden-KEF, anybody?).
Icelandair pioneered the "Iceland layover vacation" concept and Wow Air has followed suit in advertising the Keflavik layover as a feature instead of a bug. It is usually not a big problem to book flights with either airline that involve several days layover in Iceland.
- Icelandair - offers non-stop flights to/from New York City (JFK and Newark), Boston-Logan, Halifax, Toronto, Minneapolis-St. Paul, Orlando (Sanford), Seattle-Tacoma, Amsterdam-Schiphol, Bergen, Berlin-Tegel, Brussels, Copenhagen, Frankfurt, Glasgow, Gothenburg, Helsinki, London (Gatwick and Heathrow), Oslo-Gardermoen, Madrid-Barajas, Manchester, Milan-Malpensa, Munich, Paris-Charles de Gaulle and Stockholm Arlanda. Some destinations are seasonal. Icelandair offers free layovers for up to seven nights if flying between Europe and North America with Icelandair. Icelandair does not offer complimentary meals, even on long international flights, unless certain premium options are booked. On-board options to purchase are expensive, so you would be well advised to bring something to eat.
- WOW air - operates flights to/from: Berlin-Schönefeld, Copenhagen, London-Gatwick year round, and summer flights to: Alicante, Amsterdam-Schiphol, Düsseldorf, Lyon, Milan-Malpensa, Paris-Charles de Gaulle, Salzburg, Stuttgart, Vilnius, Warsaw-Chopin, and Zurich. US destinations include Los Angeles, Newark, Miami and Boston-Logan. Plans to go to Delhi are in the works, making the airline a possible choice for US-India flights. It is not yet clear whether Russia will grant overflight rights but plans are to just go around Russia if they don't. As a discount airline, WOW also does not offer free meals unless a higher class is booked, and thus it would be best to bring something to eat. As of November 30 2018, Icelandair has decided not to buy out the struggling airline. It is unsure what will happen after this point.
- SAS - offers flights to/from Oslo-Gardermoen.
- Lufthansa and its subsidiary Eurowings - operate flights from various German cities during the summer.
- Delta Air Lines - operates flights to/from New York City-JFK.
- EasyJet - offers flights to/from Edinburgh, London (Gatwick and Luton, and seasonally to Stansted), Basel and Manchester.
- Germania flies to Bremen, Nuremberg and Dresden during the summer.
- British Airways flies to London-Heathrow year round.
- American Airlines files to Dallas Fort Worth International Airport year round.
Iceland has no railway and while Keflavik airport to downtown Reykjavik is actually one of the routes where talks of building one are loudest, for the time being you are limited to road travel.
Some bus will come thirty minutes to 45 minutes after the arrival of any flight. This includes delayed flights and flights in the middle of the night. While you won't have to pre-book the Stræto bus, it comes highly recommended to pre-book if you want to go with one of the other companies. As Stræto does not run at all times, you should check schedules before deciding on an option.
- Flybus. offers regular service to either the BSI bus terminal, just south of the city centre (45 minutes, ) or directly to Reykjavik hotels with advance notice to the driver (3000 kr one-way or 5500 kr round-trip). Buses leave the airport as early as 03:30. Tickets can be bought either at the airport or online. 2500 kr one-way or 4500 kr round trip.
- Gray Line Airport Express. offers regular service directly to Reykjavik hotels with advance notice to the driver. The journey takes 45min. Tickets can be bought either at the airport or online. 2400 kr one-way or 3900 kr round trip.
- Iceland Bus 55 (The bus stop is called FLE at the airport.). Strætó route 55 offers regular service between the airport and BSÍ bus terminal in central Reykjavik though the coach companies can be cheaper round-trip. Unlike the other buses this one has intermediate stops but the fare is cheaper. 1760 kr.
Taxis cost 14,000 kr for 1-4 passengers and 19,000 kr for 5-8 passengers. Taxi drivers are generally honest and won't overcharge tourists.
The usual suspects of Avis, Hertz, Budget and Europcar are present. Note that many operators place restrictions on their cars being taken to the Interior of Iceland; practically only 4x4 vehicles are allowed to roam into there as well as all highways designated with the letter F.
A pamphlet about this alongside rules of the Icelandic roads, provided by the government, will usually be given out whenever you rent out a specific type of car.
- Icelandair Saga Lounge. Even if you don't qualify for free lounge access, this is one of the more pleasant ways to spend a layover long enough to require killing time but too short - or too late at night - to take the bus to Reykjavik
Eat and Drink
The duty free shop is actually one of the cheapest places in Iceland to buy alcohol which is why many locals grab a beer or two before heading out. There are also all manner of Icelandic or international foods on sale. Nothing in Iceland is cheap compared to most of the rest of the world and the airport is naturally no exception. Still, fish is caught locally and thus less expensive, relatively speaking, and often excellent.
While Iceland is part of the Schengen area it is not part of the EU and thus duty free shopping is available to arriving and departing passengers from all countries.
An ATM is available in the baggage claim area for you to take out króna.
There's free and unlimited WiFi.
Sleeping in the airport is actually forbidden (no doubt all those late night departures and the crowded nature of the place) and there is no hotel on the grounds of the airport itself. There is however a selection of hotels in nearby Keflavík.
Keflavik is the next town.