Iceland is a country of contrasts, breathtakingly beautiful and home to extraordinary natural phenomena. Deserts, volcanoes, valleys, fjords, glaciers and many other landforms share the space here. A quarter of the country consists of volcanoes, 12% is covered by glaciers. A mere 1% of the island's surface is tree-covered.

In 2010 Iceland shot to attention when the volcano Eyjafjallajökull (picture) erupted: partly because of its name, which news presenters and reporters struggled to pronounce, and also because the cloud of ash it produced brought air traffic in Europe to a standstill. Iceland is the world's largest volcanic island. It has about 130 volcanoes, some 30 of which are classified as potentially active.

Many volcanoes in Iceland are hidden under enormous masses of ice. The largest glacier, Vatnajökull, has a surface area as big as 1,200 soccer pitches. A tour of the ice cap is impressive, but should be undertaken only with a professional guide, because the ice is alive — new cracks and crevasses develop quickly.

The glacial meltwater makes its way to the coast through numerous river channels and tumbles down hundreds of cascades, sometimes with incredible force, as with the Gullfoss, the Golden Waterfall. The immense size of this waterfall becomes clear when you compare it to the tiny-looking tourists on the plateau on the left side of the picture.

The water bubbles up to the surface and explodes: a 30-meter (98-foot) column of boiling water shoots into the air. The famous Strokkur ("Churn") Geyser erupts every few minutes and thrills tourists with its prodigious force. It's in Haukadalur valley, a geothermal area in southwestern Iceland.

Not only Haukadalur possesses hot springs: They're distributed over the entire island and are sometimes used as hot pots and natural thermal baths. The best-known spring lies between Keflavik Airport and the capital, Reykjavik: the Blue Lagoon — a geothermal spa with naturally blue water that's rich in minerals. Bathing in it is reputed to help relieve some skin diseases.

Urban thrills are not what Iceland is typically known for; it's more associated with natural scenery. In fact, its population numbers are around 380,000. More than half the residents, about 200,000, live in the capital, Reykjavik (Smoky Bay), and its suburbs. The city has a lot to offer, especially in the boutiques, restaurants, bars and clubs along Laugavegur, the main shopping street.

Back to nature: The best way to explore it is in a jeep, on foot or on horseback. Icelandic horses play a large role on the island. They're not only a means of transportation, but also a source of income, because this robust breed has many fans. In the summer the animals graze freely in the highlands. Only in fall are they herded back to the valleys. The round-up is quite a spectacle.

If you travel through Iceland's fascinating countryside, you soon understand why many inhabitants believe in elves and trolls. There are even directories of living nature spirits and maps of where elves and dwarves live. Roads have to be built around such places so as not to disturb them. Is the rock in this picture also a troll? It has a name in any case: Hraunkarl.

In Iceland it never gets completely dark in the summer, and never completely light in the winter — but that means you can see the Northern Lights, or Aurora borealis, in the darkness. The best time is between early October and late March, when the colorful displays glow magically in the nighttime sky.