47km (29 miles) SW of Reykjavík.
For many visitors, one look down from their descending plane onto Keflavík's sprawling Lego housing is all they need to know. But Keflavík is an underrated town, and you could do much worse than spend your first or last night here. It's also a good base for all of Reykjanes Peninsula. In early September, the sea cliffs are dramatically lit up for the "Night of Lights," with live music, family entertainment, and a fireworks show.
After WWII, Keflavík prospered from providing services for the neighboring NATO base. The base was abandoned in 2006, but Keflavík maintains a strong fishing economy -- established centuries before the Americans arrived. To avoid confusion, be aware that Keflavík has merged with Njarðvík, its less interesting neighbor to the east, to form a single municipal entity called Reykjanesbær. Their joint population is over 10,000 -- by far the largest settlement on the peninsula.