The Nordic island - famous for its glaciers, geysers and hot springs - has topped TripAdvisor's list of Most Excellent Countries, followed closely behind by Ireland and the United Kingdom. Greece and Morocco completes the top five whilst the likes of France, The Netherlands and Italy made the top 10.
Meanwhile, Key West, USA was named the Most Excellent city in the world, followed by Iceland's capital Reykjavik and Edinburgh, Scotland.
Marrakech, Morocco; Amsterdam, The Netherlands; Dublin, Ireland and Bali, Indonesia all feature in the top 10 too.
Neela Pal, vice president of brand marketing at TripAdvisor, said: "TripAdvisor is the place consumers go to plan and book their trips, and study after study has shown the site's impact on travel purchasing decisions. When travelers see a Certificate of Excellence sticker or certificate on display, they immediately know that the business has a track record of offering highly rated guest or diner experiences. Now, with our 'Most Excellent' lists, we're excited to reveal the destinations where travelers are most likely to encounter these excellent businesses."