Around 1800, French merchants came to Iceland and lived in Grundarfjörður, where they constructed a church and a hospital of their own.

The town became wealthy through the fishing industry, and this wealth shows in the style of the original, luxurious houses being built.

Built in 1966, it hosts one of the 500 original lithographs of the Guðbrandsbiblía, the first book to be printed in Iceland.

They include: Annually, the town entertains "Á Góðri Stund í Grundarfirði" (Eng.

: Good Times in Grundarfjörður), a festival which hosts exhibitions of art and music.