The history of Christianity in Iceland can be traced back to the Early Middle Ages when Irish hermits settled in Iceland, at least a century before the arrival of the first Norse settlers in the 870s. Christianity started to spread among the Icelanders at the end of the 10th century. The adoption of the new faith by the whole population was the consequence of a compromise between the Christian and heathen chieftains, as well as the lawspeaker, at the national assembly or Alþingi of 999 or 1000.

Initially missionary bishops and priests of foreign origin composed the clergy, but the number of local priests quickly increased. The first Icelandic bishop, Ísleifur Gissurarson was consecrated in 1056. Within fifty years two dioceses were established in the island, with their seats at Skálholt and Hólar which were subordinated to foreign archbishops. Landowners had a preeminent role in the administration of Church affairs and earned significant income from the tithe after it was introduced in 1097. Legislation limited the bishops' authority until the end of the Commonwealth in 1264. The principle of the autonomy of the Church only prevailed at the middle of the 14th century. Monasteries, most of them established in the 12th and 13th centuries, became important centers of literature.

The Lutheran form of the Reformation which was introduced in Iceland between 1541 and 1551 caused fundamental changes in Church life, spirituality and culture. For instance, the bulk of Church estates was confiscated and the cult of saints was abolished. The first Icelandic translation of the New Testament was published in 1540, and of the whole Bible in 1584.

First Christians (c. 795 – c. 1000)

Irish monks voyaging in their small boats known as currachs seem to have been the first settlers to reach Iceland. For instance, Dicuil in his De Mensura Orbis Terrae ("Of the Dimensions of the World") writes of Irish hermits who spent, in 795, six months on an otherwise uninhabited island where the nights were so bright "not only at the time of the summer solstice, but for several days before and after" that a man could pick "lice from his shirt". The Íslendingabók ("The Book of the Icelanders") makes mention of Christians known as papar or fathers who had already settled in Iceland by the time the first Norse settlers arrived. They departed from the island leaving behind "Irish books, bells, croziers, and lots of other things"The Book of Settlements: Landnámabók (ch. 1.), p. 15. at the arrival of the new colonists.

The first Scandinavians reached Iceland in the middle of the 9th century, but its systematic colonization started in the early 870s. Although Christian individuals must have been among those who settled in Iceland, because many colonists arrived from Ireland, England or Scotland, the majority of the settlers were pagans. The latter remained strictly adhered to the cult of Odin, Thor and the other gods of Old Nordic religion. Paganism even strengthened following the establishment of the national assembly or Alþingi in 930 which gave rise to a process of unification among the Icelanders. The assembly was composed of chieftains or goðar who had a leading role in the pagan cults.

Christian missionaries started to visit Iceland in the last decades of the 10th century. A German missionary bishop, Friedrich (Friðrekr) who arrived in 981 was the first among them. He was forced to depart from the island in 986 after his Icelandic aide, Thorvald Kodransson, had murdered two men in a battle. Next the Icelandic Stefnir Thorgilsson arrived, who had been dispatched with this mission by Olaf Tryggvason, king of Norway (r. 997–1000). He was expelled from the country after he had destroyed pagan sanctuaries. Likewise, the next missionary sent to Iceland by the king, the German or Flemish Thangbrand, was forced to leave around 999 because he had murdered some of those who opposed his mission. He reported to the king "that it was beyond all expectation that Christianity might yet be accepted"Íslendingabók: The Book of the Icelanders (ch. 7.), p. 8. in Iceland, although he had succeeded in converting many chieftains. On hearing this, King Olaf decided to have all pagan Icelanders who were staying in Norway captured and to forbid all Icelanders from Norwegian ports. Since Norway was Iceland's main trading partner, Icelanders needed to maintain the peace. Accordingly, two Christian chieftains who were related to King Olaf, Gissur Teitsson and Hjalti Skeggjason, were sent to Norway. They promised the monarch that they would be making every effort to convert the whole island. In response, King Olaf released his hostages, many of whom were related to pagan Icelandic chieftains.

Christianization (c. 1000)

Gissur Teitsson and Hjalti Skeggjason returned to Iceland. Initially they were planning to set up a separate administration for the Christians. The sharp contrast between the views of the most radical pagans and those of the Christian chieftains became manifest at the Alþingi of 999 or 1000. In order to avoid the breaking out of a civil war, the goðar finally agreed to appoint one of their number, the Lawspeaker Thorgeir Thorkelssonwho was a paganto decide the case. He withdrew for a whole day and then announced his decision to the assembled chieftains: all Icelanders had to be baptised, but heathens were allowed to worship Odin and the other gods in secret. He even permitted the continuation of the old practice of exposure of babies at birth and the eating of horsemeat, related to the importance of horses in Germanic paganism. Many goðar and their retinue were baptized on the spot in the cold water, but "all the people from the Northern and Southern Quarters were baptised in Reykjalaug in Laugardalr"Kristni Saga: The Story of the Conversion (ch. 12.), p. 50. where geothermal springs could be found. Legend says that Thorgeir Thorkelsson decided to throw all his domestic idols into a large waterfall which was named Goðafoss or "Gods' Waterfall" after this event.

The story of the consensual conversion of Iceland was first recorded by Ari Thorgilsson in the early 12th century. Historian Gunnar Karlsson states that Ari Thorgilsson's narration is "unbelievable, but it is the only one we have". All the same, the story "has been used to suggest that voluntary Christianization of an entire population was possible, without any link to a central power" (Nora Berend). Thorgeir Thorkelsson's verdict can even be cited as a "measure of crisis management to save Iceland from a bitter split". On the other hand, the historian Anders Winroth emphasizes that the goðar, through their conversion, "monopolized religion for their group, making it more difficult for new men to join their ranks".

It is without doubt that social attitudes changed radically in short time after the conversion. For instance, duels which had traditionally been fought at Thingvellir were prohibited and slavery declined from the early 11th century. All pagan customs confirmed by Thorgeir Thorkelsson's verdictincluding the worship of Norse deities in privatewere abolished in 1016, mainly due to the efforts by King Olaf II of Norway. The grateful monarch sent a bell and timber after this decision in order to promote the erection of a church at Thingvellir.

Middle Ages (c. 1000–1536)

Icelandic Commonwealth (c. 1000–1264)

The institutional framework of Christianity was developing in the 11th century. Individual landownerseither goðar or simple farmersplayed a preeminent role in the process: they built the earliest churches and employed the first priests. Accordingly, most churches were for centuries controlled and administered by them and by their descendants, which contributed to the evolution of "a system of privately run churches" (Gunnar Karlsson).

The first clergymen were foreigners, mostly from England or the Holy Roman Empire. However, it was not unusual, at least up until the 1150s, that goðar were ordained as priests. A landowner could also hire a poor young man to be trained for the priesthood in order to serve in his sponsor's church. Such a cleric or kirkjuprestr had limited freedom, because his employer was entitled by law to force him to return if he had departed from the church entrusted to him. Likewise a priest hired by a landownerknown as ðingaprestrbecame a member of his employer's household, but he received a regular fee for his services and could serve in more than one church.

Besides landowners, missionary bishops played a significant role in the early development of the local Church. The Íslendingabók enumerates a number of them, including "Jóhan the Irishman",Íslendingabók: The Book of the Icelanders (ch. 8.), p. 10. and Bernard from England, who spent a couple of years in Iceland. The last of these "wandering bishops" (Anders Winroth), Rudolph departed from Iceland in 1050.

The first local prelate, Gissur Teitsson's son, Ísleifur was elected at the Alþingi of 1055. His earlier studies in the school of Herford Abbey made him a suitable candidate, although he had been living in marriage. Following his election, the Alþingi requested him to make a journey abroad in order to be consecrated. Ísleifur visited Archbishop Adalbert of Hamburg (r. 1043-1072) who ordained him as bishop on Whitsun in 1056. Bishop Ísleifur settled in his family's farm at Skálholt, but his position remained similar to a missionary bishop because he had not been ordained to a particular episcopal see. The Hungrvaka adds that he had to compete with "bishops from other lands"Hungrvaka (ch. II.), p. 47. who were supported by many locals because they were less demanding. Byock, and other specialists identify these prelates with five foreigners mentioned in the Íslendingabók who "called themselves bishops".Íslendingabók: The Book of the Icelanders (ch. 7.), p. 10. Íslendingabók adds that three of them arrived from ermskir, which has been identified with Armenia or Ermland. It is without doubt that they represented a Paulician or other doctrine alien to Western theology. Accordingly, Archbishop Adalbert "sent his brief out to Iceland and forbade the men to accept all services from them" because they had been excommunicated.

Bishop Ísleifur set up a school at Skálholt in order to educate the local clergy. He died in 1080. The Alþingi appointed, in 1082, his son, Gissur to succeed him. At the assembly, all chieftains promised the future bishop that they would accept his decisions without resistance. At Pope Gregory VII's order, Gissur Ísleifsson was consecrated by the archbishop of Magdeburg, because the archbishop of Hamburg was the pope's enemy at that time. Bishop Gissur proclaimed Skálholt his see and donated his inherited farm to the new diocese. He achieved the introduction of the tithe at the Alþingi of 1097. Revenue from the tithe was divided into four parts among the bishop, the local priest, the church and the poor. Landowners who administered a church were entitled to the part of the tithe which served the upkeep of the church building. Moreover, they also received the part due to the priest if the latter was a member of their household.

Upon the request of the inhabitants of the Northern Quarter, Bishop Gissur approved of the establishment of a second bishopric with its see at Hólar. Its first prelate, Jón Ögmundsson was consecrated in 1106 by the archbishop of Lund in Denmark. The heads of the two Icelandic dioceses remained suffragans to the archbishops of Lund until the new archbishopric of Nidaros was established in Norway in 1153.