Eyrarbakki is a fishing village on the south coast of Iceland with a population of about 570 people, not including inhabitants of the prison located there. The village is founded on the Great Þjórsá Lava.
For centuries, the harbour at Eyrarbakki was the main port in the south of the country, and Eyrarbakki was the trading centre for the whole of the southern region extending from Selvogur in the west to Lómagnúpur in the east. By about 1925, however, Eyrarbakki lost its importance as a trading centre. The latter part of the 19th century saw a great increase in the number of oared fishing boats. In fact, although trade and fishing were the main occupations in Eyrarbakki, the natural harbour conditions were not good, and after the bridging of the nearby River Ölfusá, the harbour fell into disuse.
