The appointment of Ossie Ardiles as the Tottenham manager effectively spelt the beginning of the end for Guðni, who feared a life away from football at one stage.
Guðni made his Bolton debut in the most extreme surroundings of Wembley Stadium when coming on as a substitute for Scott Green in the 1995 Football League Cup Final defeat to Liverpool.
England winger Steve McManaman had given Green a torrid time throughout the afternoon but Guðni's introduction gave Bolton renewed hope, as his first touch was to supply the cross for Alan Thompson to score.
In 1996–97, the club finished the season as champions of the old Division One (now Championship), with Guðni chipping in with three vital league goals, two of which came in the 7–0 defeat of relegation-haunted Swindon Town.
During the 1997–98 season, the team relegated again, but this time the club showed much more of a fight than in their previous stint in the top league, only losing out to Everton on goal-difference on the final day.
Guðni equalised for the Trotters shortly before half time with a 35-yard shot from right-back which sailed into the top corner past the goalkeeper David Watson.
Players such as Mark Fish, Andy Todd, Jon Newsome and Paul Warhurst had all played in the heart of the defence in his absence, rumours even circulated that he may leave but this was soon dispelled.
First, the club lost out to Tranmere Rovers in a two-legged League Cup semi-final, then were defeated by Premiership side Aston Villa on penalties in a hard-fought encounter at Wembley in a game which Guðni picked up a hamstring injury.
Bolton criticised the highly controversial performance of referee Barry Knight claiming that the Orpington official had given Ipswich an unfair advantage.
However, new Wanderers manager Sam Allardyce persuaded the ever reliable Guðni to sign up for another year and he did not disappoint as he scored 10 goals from defence, putting in a string of excellent performances alongside the likes of Whitlow and Colin Hendry, as Bolton ultimately returned to the Premiership following a 3–0 play off win over Preston North End at the Millennium Stadium in Cardiff.
He is number four in Iceland's all-time international appearances list, behind record-holder Rúnar Kristinsson, Hermann Hreiðarsson and Eiður Guðjohnsen.