Iceland, like America, experienced a period of Prohibition in the early 1900s. While the ban on alcoholic drinks was lifted in the 1930s, restrictions stayed in place for beer, stating that beer couldn't contain more than 2.25% ABV. This continued until the March 1st, 1989, when these restrictions were lifted - March 1st is now celebrated as Beer Day in Iceland!
The removal of these restrictions meant that more and more beer was enjoyed in Iceland, and soon enough the number of Icelandic brewers began to grow. One of the most well known Icelandic beer brands is Einstök, who make some cracking pale ales and toasted porters.