The town of Ísafjördur is the municipal centre of the West Fjords peninsula. The West Fjords are Iceland's least populated region, with 9,600 inhabitants in the area of nearly 6,000 square miles (9,520 sq km). Ísafjörður, with a present population of approximately 3,500, was formerly one of Iceland's main trading posts and as such, was granted municipal status in 1886. Some of Iceland's oldest and best-preserved buildings, dating from the 18th century, are located in Ísafjördur.
The town is still predominantly a fishing centre. A vigorous and varied cultural and artistic scene flourishes as well. Mountains surround Ísafjördur on the three sides and the sea on the other. The ancient settlement site of Eyri downtown is enclosed by the narrow Skutulsfjordur fjord, which shelters the harbour in all weathers.