Dimmuborgir (The Dark Castles) is considered by most natives to be the single most impressive place in Iceland. Located by Lake Mývatn in North Iceland, it is a lava field displaying the most unusual rock formations and caves. It is dramatic, to say the least. Icelandic folklore maintains Dimmuborgir is where earth connects with Hell. In Nordic Christian lore, it is also said to be the place where Satan plummeted when he was cast from Heaven, and later created the Catacombs of Hell.
The lava and the lake
In reality, Dimmuborgir was formed by a lava-lake, flowing from a large eruption about 2300 years ago. On the site of Dimmuborgir, the lava pooled over a small lake. As the lava flowed across the wet sod, the marsh water boiled with vapor rising through the lava, forming lava pillars. Some of the pillars were several meters in diameter. As the lava continued flowing towards the lower ground, the crust collapsed, leaving the hollow pillars of solidified lava standing.
Dimmuborgir is characterized by large hollow chamber-like structures formed around bubbles of vapor; some of them large enough to serve as "housing." The area is a maze, and you have to take care not to get lost there, as there are no prominent landmarks in the vicinity.
Dimmuborgir is home to the Icelandic Jólasveinar (Christmas Lads) and their parents, Grýla, and Leppalúði.
Below is the location of Dimmuborgir by Mývatn lake on the map of Iceland