Best place to find Icelandic sweater, wool for knitting, etc.

There are some locals who post on the TripAdvisor Iceland forum who would know this for sure.

These shops are all over the country. Yes the hand knitting association store on rainbow road in Reykjavik is great and has the most variety, but you will find all sorts of places with yarn and hand knit items. Of the 3 sweaters I have bought in Iceland, one was from the hand knitting association, one was from a small store in Hellisandur and the other was in a gas station in the Westfjords. You really never know what or where you will find these.

I bought wool knitting yarn at a grocery store (maybe Bonus?). A huge variety and good quality.

Netto is the grocery store that carries yarn, but only in certain stores. The one in Keflavik has it.

Hello!
Yarn is always my souvenir.
You have several good options.
I actually like the Bortargun location of any of the Handknitting Association’s store. Had much more yarn to chose from. That location is by Harpa, on a side street by the harbor.
I’ve also bought yarn at two stores near the Laugavegur intersection by the mall area on the other side of Harpa.

If you are over by the Hilton Nordic hotel, up the hill behind that is a great neighborhood most tourists don’t venture to. Some fantastic second hand clothing stores up there; but also a great yarn store. Forgot the name of it but can look up if you want.

The Lopi is cheaper there because it’s made about 45 minutes away from Reykjavik. And it seems like I can get some colors I can’t find outside of Iceland. You could go to the Lopi factory for a tour or shopping, too.

And please don’t forget to look up Helene Magnussen. Some of her yarn is sold at the Handknitting Association stores. I don’t think she owns a shop anymore but you can find her amazing website.

Have fun!