I have stayed at this hotel several times when visiting Iceland. I like it quite much. The staff are friendly, good service, breakfast plentiful with a good selection for different tastes, restaurant is good and not to mention the free access to the sports club in the basement. I would definitely stay here again next time. The rooms have always been clean and comfortable. No complaints really. The standard is not top notch but still good.
I will choose this hotel again when having an early flight !

My husband and I decided to stay in a hotel close to the airport for the final night of our honeymoon stay in Iceland. We were worn out from travel and fun, and wanted a place where we could rest, hang-out, have a drink, etc.. I booked us a room at a different Keflavik hotel online late the night before, and when we arrived at the hotel the next afternoon we were, well...disappointed, to say the least. Normally we would have just settled and made the best of it, but because it was our honeymoon, we decided that we should take the loss on the night's stay at the disappointing hotel and find something better. That's how we ended up at the Icelandair Hotel. What a relief! The staff was amazing, and the hotel manager took pity on us and gave us a great deal and a great room to spend our final honeymoon night in. The hotel itself is clean and modern and well-equipped and the room was even more so...light-filled and luxurious (which is exactly what we were looking for). We hung out in the bar that evening and had great martinis and excellent service from the waitress/bartender, and the free breakfast buffet the next morning blew us away! This was no cold-cereal and toast breakfast buffet...there were eggs and cereal and meats and cheeses and bread and fresh-made waffles and fruit and coffee and juice...I could go on. It was amazing. There is no way I could give Icelandair Hotel anything less than 5 stars as they went out of their way to make our stay a beautiful one. I highly recommend it as the place to stay in Keflavik.

My boyfriend and I chose to stay here on the last night of our visit to Iceland as we had an early flight home out of Keflavik the next day.
We arrived at the hotel via the Blue Lagoon and were dropped off by a very friendly Reykjavik Excursions bus driver. Unfortunately such good service was not offered to us by the receptionist of the hotel who seemed more interested in chatting on the phone. She was utterly off-hand and disinterested in providing any sort of help (I had to face her joie de vivre once more upon getting to the room and discovering our remote control didn't work).
The hotel building was so 70s, inside and out! Stained carpets in the halls and lift though the room itself was perfectly clean. Our room was large enough but just felt so tired and dated, CRT tv, old transistor radio system in one of the bedside cabinets and as for the bathroom... Yep, as mentioned by other reviewers it was a prefab all-in-one type pod, reminded me of the bathroom you'd get in a ferry cabin. Really, really horrible.
The hotel did have a few plus points, it serves an early breakfast for people catching crack-of-dawn fights and there's also a free taxi service to the airport starting from 5am. However, you have to book this in advance and there were only 6 seats in the taxi so book it quick. The airport is less than 10 mins drive away though so I assume you wouldn't have to pay too much (by Icelandic standards!) should you have to book your own transfer.
There is no way on earth that this is a four star hotel, there were no extras whatsoever in the room, I'd say it's pretty on par with Travelodge type accommodation but with the availability of breakfast.

Stayed here in april 2011 too. Both times a nice comfortable, clean and well provided room. Pleasant reception staff. On second occasion they had not put an extra bed in the room for my 11 year old son, which since we arrived at 1 o'clock in the morning was rather irritating ( they thought 3 people might all share a double bed!). When asked they did soon remedy this. Amazing breakfast both times, pastries the first time and small pancakes the second time with a good choice of cooked and other things too.