Bakkagerði is the largest village in the Borgarfjörður Eystri fjord area and is one of the greatest natural treasures of the entire island. It serves primarily as a center and starting point for many hiking trails of varying difficulty (there are a total of 17 hiking trails). The nearby rock formation Hafnarhólmi boasts amazing colonies of nesting gulls, fulmars, and the colorful “sea parrots” – puffins, which are popular among tourists. There is also a campsite directly in the village.

The village of Bakkagerði is located about 70 kilometers northeast of the town of Egilsstaðir on the shores of the Borgarfjörður Eystri fjord.