Two main valleys enter from Skutulsfjörður, Engidalur and Tungudalur, separated by the mountain Kubbi.
There is a golf course and ski area in Tungudal, but from it the Vestfjarðagöng tunnel is dug across to Botnsdalur in Súgandafjörður and Breiðdalur in Önundarfjörður.
[1] The mountain located above the main part of the town is called Hlíðarfjall.
On Ernir, there are two massive depressions, often called "troll seats", named Naustahvilft and Kirkjubólshvilft, with the former being a popular hiking trail.
[2] In 1994, an avalanche fell in the fjord and destroyed the ski area located in Seljalandsdalur and the summer houses in Tungudalur.