The village of Grundarfjordur is situated in a fjord with the same name surrounded by imposing mountains. The communities name is Eyrarsveit , stretching from Hraunsfjordur in the east to Bulandshofdi in the west, the population of Eyrarsveit is about 900. On the western side of Grundarfjordur the fjord, Mt. Kirkjufell separated from other mountains rises magnificently.
Grundarfjordur the village was one of the first villages in Iceland. It became a trading centre for Snowfellsnes 1786. Its harbour is considered one of the best natural harbours on Snowfellsnes. Around 1800 Frenchmen settled in Grundarfjörður with their shipping fleet and left at 1860.
The main source of income is fish and fish processing. Tourism is of growing importance.