Reykjav??k. Reykjav??k is the capital and largest city of Iceland. It is located on the southern shore of the Faxafl??i bay in southwest Iceland and has a latitude of 64??08??? N, making it the world's northernmost capital of a sovereign state. Reykjav??k has a population of around 139,000 as of 2025, and the surrounding Capital Region has a population of around 249,000, constituting approximately 64% of Iceland's population.