The natives have cheekbones so sharp they can draw blood, the local word for cloud is ský, rotten shark meat is considered a delicacy and Ketill, meaning ‘kettle', is a popular boys' name. It's life through the looking glass – welcome to the topsy-turvy world of Reykjavík.

To the west the cold expanse of the Atlantic Ocean stretches on towards Greenland; to the east mossy lava plains meet bare orange mountains, hot springs and the largest desert in Europe. Reykjavík is a city that feels like it's sprung up from nowhere, where modern architecture reflects the aurora borealis in the winter sky and you can bathe outdoors in the geothermal pools breathing clear, pure air straight from the glaciers. The country's location on the Mid-Atlantic Ridge has generated an independent, vibrant and creative environment where nature is forever active with volcanoes, earthquakes and hot springs.

The city cherishes its position as the northernmost capital city in the world, out of reach of convention. Being so far off the European map has practically been a licence to be unusual, quirky and ground-breaking in many areas from music to pop art and lifestyles. But behind the futuristic hairstyles and ethereal music lies a city well-grounded in history and folklore. If you counted up all the elves and huldufólk, or hidden people, that are said to exist in the Reykjavík suburb of Hafnarfjörður, the small town would take on the dimensions of any other European city.

The strangeness of everyday life is mirrored in Reykjavík's surreal natural beauty. It's so far north that the sun, like the locals, barely sleeps in summer, dipping briefly into the sea in the early hours of the morning. In the winter it sleeps off a long hangover of its own. Peering out across the Faxaflói Bay, past the old whalers, you can usually catch a glimpse of Snæfellsjökull, the magical glacier which has inspired writers for centuries with a sense of its mystery. Closer still, Mount Esja looms purple, mauve and pink against a bloodshot sky at sunset, its snow-dusted peak changing colour with every passing season.

Reykjavík is a city for dreamers, fantasists and individuals. Somewhere you can lose yourself in the Viking Age sagas of independent thinkers who rewrote the laws their way; visit the National Park, Þingvellir, which is growing at a rate of around 2 cm a year; or enjoy Iceland's sense of humour in the city's assortment of museums, including the only penis museum in the world. Icelanders have the highest standard of living and longest life expectancy of all of Europe's citizens. The beer might be expensive but the air is clean, creativity is a way of life and you'll go home with a different perspective. Out here, it's the only one they have