Iceland (i; Icelandic: Ísland [ˈistlant]), also called the Republic of Iceland, is a Nordic island country between the North Atlantic and the Arctic Ocean. It has a population of 329,100 and an area of 103,000 km2 (40,000 sq mi), making it the most sparsely populated country in Europe. The capital and largest city is Reykjavík. Reykjavík and the surrounding areas in the southwest of the country are home to over two-thirds of the population. Iceland is volcanically and geologically active. The interior consists of a plateau characterised by sand and lava fields, mountains and glaciers, while many glacial rivers flow to the sea through the lowlands. Iceland is warmed by the Gulf Stream and has a temperate climate, despite a high latitude just outside the Arctic Circle. Its high latitude and marine influence still keeps summers chilly, with most of the archipelago having a tundra climate.
According to Landnámabók, the settlement of Iceland began in the year 874 when the Norwegian chieftain Ingólfr Arnarson became the first permanent settler on the island. In the following centuries, mainly Norwegians and to a smaller extent other Scandinavians settled Iceland, bringing with them thralls of Gaelic origin. From 1262 to 1814, Iceland was ruled by Norway and afterwards by Denmark. Until the 20th century, the country relied largely on fishing and agriculture. Iceland became independent in 1918 and a republic in 1944. Industrialisation of the fisheries and Marshall Plan aid following World War II brought prosperity and Iceland became one of the wealthiest and most developed nations in the world. In 1994, it became a part of the European Economic Area, which supported diversification into economic and financial services.