A review and assessment of data pertaining to the origin and nature of low-temperature geothermal activity in Iceland are presented. This activity is widely distributed in Quaternary and Tertiary formations on the American plate in western Iceland west of the active belts of volcanism and rifting but it is very sparse on the European plate east of these belts. Low-temperature systems occur in a few places within the active volcanic belts. Temperatures range from just above ambient to a little over 150 degrees C. Generally speaking, reservoir temperatures decrease with increasing distance from the active volcanic belts. The distribution of the low-temperature areas can be correlated to a large extent with active tectonism. In Iceland the European plate is tectonically stable but in the American plate the shear stress field is complicated, leading to complex fracturing and faulting of the crust at present. No single generalized conceptual model describes the basic features of all low-temperature areas in Iceland. Low-temperature geothermal activity is considered to develop by one of the following four processes, or any combination of them: (1) deep Row of groundwater from highland to lowland areas through permeable structures driven by the hydraulic gradient; (2) convection in young fractures formed by tectonic movements in old and relatively impermeable bedrock; (3) drift of high-temperature geothermal systems out of the active volcanic belts in conjunction with their cooling and extinction of the magma heat source; and (4) magma intrusion into Quaternary or Tertiary formations adjacent to the active volcanic belts. Formation of permeable fractures by recent earth movements is probably the most common process responsible for the development of low-temperature activity through convection in these fractures. Convection in low-temperature systems with temperatures above some 60 degrees C is probably mostly driven by pressure differences created by a relatively light hot water column within the system and a denser cold water column outside it. in systems of lower temperature the convection is driven by hydrostatic head in the recharge areas. The source of the low-temperature waters is largely meteoric. However, in some coastal areas a significant seawater-groundwater component is present, up to 10%. Waters not containing a seawater component are low in dissolved solids, or in the range 150-500 ppm. The reason is the low content of anions, particularly Cl, in the basaltic rock forming soluble salts with the major aqueous cations. Geothermal waters from the low-temperature areas in Iceland typically possess lower delta D-values (more negative) than the local precipitation. This difference is variable; most often it lies in the range of 10-30 parts per thousand delta D, but it may be as large as 70 parts per thousand. This difference has been considered to indicate that the recharge areas to the low-temperature areas lie inland on higher ground, the distance being as much as 150 km. The interpretation favoured here is that at least some of the low-temperature waters contain a component of ＇＇ice-age water＇＇, i.e. water that is older than about 10,000 years. The ＇＇ice-age water＇＇ is depleted in deuterium relative to today＇s precipitation. When ＇＇ice-age water＇＇ is present in the geothermal water, deuterium cannot be used as a tracer to locate the recharge areas to the geothermal areas and in this way to deduce about regional groundwater Row.