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Reykjavík is not the shopping mecca that is Paris or London, but a new wave of boldly conceptual storeowners is gaining almost as much attention as the restaurateurs. Most shops are concentrated on Laugavegur and Skólavörðustígur -- so don't hold out much hope for the thrill of a back-alley discovery -- but Laugavegur's offshoots and side streets are quickly building up. Other good shopping streets are Austurstræti (especially for souvenirs), Hafnarstræti, and Bankastræti.

Reykjavík is a good place to buy supplies before hitting the rest of the country, where goods are even more expensive. General shopping hours are 9am to 6pm weekdays and 10am to 4pm Saturdays. Almost everything is closed Sunday except for a few shops, particularly those selling woolens and puffin snow globes. Note: Store listings below do not indicate opening hours unless they deviate from the norm.

Save up to 15% with a VAT Refund

Iceland Refund (tel. 564-6400; www.icelandrefund.com) reimburses you the Value-Added Tax you pay (about 15% of purchase price) under the following four conditions: 1) purchases must be taken out of the country; 2) each sales receipt must total at least 4,000kr ($64/£32) -- for less expensive items you can consolidate purchases at a single store; 3) purchases must be from an accredited store; and 4) you must leave the country within 3 months of purchase. When you make a purchase, request a Global Refund Cheque, which must be signed by the salesperson. Your refund can be claimed from the following places: Keflavík Airport, at the Landsbanki Íslands Bank at the far end of the departure hall; the Seyðisfjörður ferry to Europe, onboard prior to departure; and Reykjavík's Tourist Information Center. If the total value of your refund is less than 5,000kr ($80/£40) (that is, if your total purchases amount to about 33,000kr/$528/£264 or less), you can receive the refund directly in cash or have it applied to your credit card at the airport or the ferry; at the Tourist Information Center, you can only have it applied to your credit card. If the refund is more than 5,000kr ($80/£40), your only option is to have the refund applied to your credit card no matter where you claim it -- and all goods (except woolens) need to be shown at customs before check-in for your departing flight.

Books & Music

English-language books are not hard to come by, as most Icelanders prefer them to translated editions.

Jewelry

Jewelry is relatively less expensive in Iceland, especially gold and silver. You'll find countless items inspired by the country's natural features and pagan history, often made from lava stones and native minerals. Most jewelers eagerly customize designs, a good way to bring home a little piece of Iceland (especially since it's illegal to collect minerals yourself). For classic jewelry, try the well-stocked Gull & Silfur, Laugavegur 52 (tel. 552-0620) or flashier Jón & Óskar, Laugavegur 61 (tel. 552-4910).

Outdoor Gear

Cintamani, Laugavegur 11 (tel. 533-3800; www.cintamani.is), the upstart competitor of fashionable 66° North , has slightly lower prices, more camping gear (tents, boots, maps, and so on), and a travel agency for adventure tours. Útilíf (www.utilif.is) is the best place for technical outdoor equipment, especially for camping, climbing, cycling, and fishing -- or if you just forgot your swimsuit. Reykjavík boasts two locations: Kringlan (tel. 545-1580) and Smáralind (tel. 545-1550).

Woolens

Over centuries of harsh weather, Icelandic sheep evolved a dual-layered wool: Inner fibers are soft and insulating; outer fibers are water and dirt repellent. These qualities combine for knitwear that is surprisingly light, resilient, and wearable in all kinds of weather. Sweaters in traditional Icelandic patterns are well-known, and you'll also find wonderful hats, mittens, socks, and blankets. Don't wait until your return to Keflavík Airport to buy your sweaters; the selection isn't near what it used to be.

A miniature branch of the discount outlet in suburban Mosfellsbær, Álafoss, Laugavegur 1 (tel. 562-6303; www.alafoss.is), offers marginal savings over its competitors, and has a decent selection of sweaters and handicrafts. Clothing line Farmer's Market (www.farmersmarket.is) doesn't have its own shop, but the brand is worth seeking out for its sexier, lighter, less bulky take on traditional Icelandic sweater patterns. The sweaters are made from Icelandic wool, but don't wear one into the Handknitting Association store -- they're manufactured abroad. They're available at Kisan , the Keflavík airport, the Blue Lagoon, and Geysir.

Note: This information was accurate when it was published, but can change without notice. Please be sure to confirm all rates and details directly with the companies in question before planning your trip.