Until the Reformation, Iceland’s principal libraries were predominantly housed in monasteries and at the two bishoprics of Hólar and Skálholt. Monasteries were abolished shortly after 1550, while the episcopal sees remained centres of learning until the end of the 18th century. The export of manuscripts to Denmark and Sweden in the 17th century, and the fires at Skálholt (1589 and 1639) and at Hólar (1709), damaged the preservation of Icelandic literature; the greatest blow came in 1728 when a fire in Copenhagen destroyed part of the huge collection that had been amassed by Árni Magnússon (1663–1730), professor at the University of Copenhagen. This collection, now partly preserved in Iceland, remains the most significant store of early Icelandic manuscripts and was to play a central role in Iceland’s later struggle for independence and national identity.

The first local reading societies were established around 1800, but it was not until 1817 that the idea of an Icelandic national library first emerged. The German scholar Friedrich Schlichtegroll (1765–1822) wrote to the German-Danish theologian Friedrich Münter (1761–1830), proposing an Icelandic Society (Societas Islandica) that would have the role of initiating the establishment of a library in Iceland “to hold collections of books in all sciences, in natural science and chemistry, ancient history and the arts”. Hið íslenzka bókmenntafélag (the Icelandic Literary Society) had just been established in the previous year, and in 1817 one of its directors, the Danish philologist Carl Christian Rafn, took matters in hand. He offered a donation toward the establishment of the library in 1818, and other benefactors followed suit. The first books were brought to Iceland two years later; in 1825 the library was officially opened in the loft of Reykjavík Cathedral. It remained in that location until 1881, when it was moved to the newly-built Parliament House, next to the cathedral. The Icelandic folklore collector Jón Árnason had become the library’s first permanent employee in 1848, and when the library was relocated to Parliament House and named Landsbókasafn Íslands (the Icelandic National Library), he became the country’s first national librarian. Around the same time, the library also acquired the large and important manuscript and book collection of Jón Sigurðsson, the leader of the country’s independence movement, who had been president of the Copenhagen branch of the Icelandic Literary Society from 1851 and had taken a keen interest in the library in Reykjavík.

The next watershed in the history of the National Library came in 1909 when it, along with the Museum of Antiquities, the National Archives and the Museum of Natural History, was relocated to new purpose-built premises in Reykjavík. The construction of this building marked a victorious moment in Icelandic history: the achievement of partial autonomy from Denmark (“Home Rule”, 1904). As Iceland’s first State Minister, Hannes Hafstein (1861–1922), stated during his speech at the building’s opening ceremony, it was not only intended to preserve old records from ruin, but also to “arm the living generation in its struggle towards the progress of the nation, every step of the way”.