Krafla is a volcanic caldera of about 10 kilometers in diameter with a 90 kilometer long fissure zone. It is located in the north of Iceland in the Mývatn region and is situated on the Iceland hotspot atop the Mid-Atlantic Ridge, which forms the divergent boundary between the North American Plate and the Eurasian Plate. Its highest peak reaches up to 818 meters and it is 2 kilometers in depth. There have been 29 reported eruptions in recorded history.

Iceland is a place where it is possible to see plate tectonics at work. It sits astride the Mid-Atlantic Ridge; the western part of the island nation is part of the roughly westward-moving North American plate, while the eastern part of the island is part of the roughly eastward-moving Eurasian Plate. The north–south axis of the Mid-Atlantic Ridge splits Iceland in two, roughly north to south. Along this ridge many of Iceland’s most active volcanoes are located; Krafla is one of these.

Krafla includes the crater Víti, one of two well-known craters by this name in Iceland the other is in Askja. The Icelandic word “víti” means “hell”. In former times, people often believed hell to be under volcanoes. Víti has a green lake inside of it.

South of the Krafla area, but not actually within the caldera is Námafjall, a mountain, beneath which is Hverir, a geothermal area with boiling mudpools and steaming fumaroles.

The Mývatn fires occurred between 1724 and 1729, when many of the fissure vents opened up. The lava fountains could be seen in the south of the island, and a lava flow destroyed three farms near the village of Reykjahlíð, although nobody was harmed.

Between 1975 and 1984 there was a volcanic episode within the Krafla volcano. It involved nine volcanic eruptions and fifteen uplift and subsidence events. This interrupted some of the Krafla drill fields. During these events a large magma chamber emerged. This has been identified by analyzing the seismic activity.

Since 1977 the Krafla area has been the source of the geothermal energy used by a 60 MWe power station. A survey undertaken in 2006 indicated very high temperatures at depths of between 3 and 5 kilometers, and these favorable conditions led to the development of the first well from the Iceland Deep Drilling Project that found magma 2.1 km deep beneath the surface.