What are the wild camping regulations in Iceland?

The "Visit Iceland" website has a page about your rights to camp in Iceland.

Camping with no more than three tents is allowed on uncultivated ground for a single night, unless the landowner has posted a notice to the contrary. However, campers should always use designated campsites where they do exist. Do not camp close to farms without permission. If a group of more than three tents is involved, these campers must seek permission from the landowner before setting up camp outside marked campsite areas.

So, if there is no sign, and the land isn't being used to grow things, you have the right to camp there for one night. That is pretty much all the law says.

So, yes you can camp at the side of the road, IF there is a place to park your car. You should not park your car on the land.

Do not drive off the road or track. Motor vehicles can leave marks that last for generations. Driving off roads or tracks is against the law except when the ground is frozen and covered in snow. See further information under “Practical Information/Driving in Iceland”.

Staying away from houses is just a basic courtesy. The best rule of thumb to follow in my experience is to never be close enough that you can see anything in the windows, and definitely stay away from gardens and obviously enclosed personal space. 300 meters at the minimum.

Sources:

• Your rights and obligations - visiticeland.com
• my own personal experiences camping in the wild in Iceland, Sweden and Finland.

I was in Iceland 3 weeks ago, July 2017. Wild camping was a priority for me and my two sons. It's essentially impossible to wild camp. Reasons:

It is aggressively discouraged by icelanders, understandably because of the large number of potential morons mucking up the country side. If the clientele were typical outdoorsmen it might be different.

There are no trees or cover on 90% of the island.

The areas amenable to tent camping with a reasonably soft surface (not lava) are all near the coast which is occupied by farmers pretty much exclusively. There is no land unoccupied by farmers along the ring road. Trying to find farmland to pitch a tent with permission, though it might be legal is just plain rude and idiotic.

To get remote, one must go into the highlands. The highlands also have no trees or geography to break the wind or offer cover. It is, therefore, impractical and somewhat risky to pitch a tent and sleep. People do it, but very dicey.

Unlike the US, there are no back country trails/passes to help backpackers find remote sites to camp. Camping anywhere other than designated campsites is highly discouraged.

As "wild" as Iceland truly is, wild camping is not much of an option. Having said that, we did manage to find a farm road that led us toward a hike that landed us at the base of a waterfall and a soft spot to lay down two tents and spend the night in one of the most amazing scenes ever. Our tents pressed down some grass, and we left some human foot prints along the way. I would wager the sheep left more of a footprint and within days our presence vanished.

Bottom line: if you want remote backpacking and wild camping do not go to Iceland. I repeat, don't go to Iceland.

If you want to see one of the worlds last remote wonders and astonishing natural scenes go to Iceland. The entire island would be a national park in the US. The beauty is not capably captured by words or even photos. Go there as a guest, enjoy the kindness of the natives, and marvel at the raw beauty of the never ending landscape. It is truly a phenom of nature. But plan on sleeping in a campground or other accommodations. Hope this helps people like me who are used to walking into the woods for a few days with no second thoughts.