How the Blue Lagoon was formed and discovered in Iceland

The Blue Lagoon formed in the 1970s as an unintended byproduct of geothermal energy production at the Svartsengi Geothermal Power Station. Mineral‑rich geothermal seawater released and collected in nearby lava fields, creating the iconically blue water reservoir. Locals soon began bathing in the warm water and noticed soothing effects on their skin, prompting scientific research that ultimately led to the founding of Blue Lagoon in 1992.

How was the Blue Lagoon formed?

The story of the Blue Lagoon begins in the 1970s at the Svartsengi Geothermal Power Station on Iceland’s Reykjanes Peninsula. There, superheated water is extracted from deep underground to generate electricity and provide geothermal heating for nearby communities.   During this process, excess geothermal seawater flowed onto the surrounding lava fields. Instead of seeping through the porous lava, the water’s high mineral content caused it to collect within the volcanic rock. Over time, this mineral rich water formed a milky blue reservoir that eventually became the Blue Lagoon we know today—one of Iceland’s most iconic natural attractions.

How was the Blue Lagoon discovered?

The discovery of the Blue Lagoon began with two fundamental elements of science: curiosity and observation. When the blue water reservoir formed, locals soon began bathing in it—which is hardly surprising in a country where soaking in warm water has long been a way of life. Word quickly spread as people noticed their skin felt calmer and healthier after bathing, and those with psoriasis reported visible improvement.   These early observations caught the attention of scientists and medical professionals. They wanted to understand why this blue water behaved differently from other geothermal waters in Iceland, and what gave its apparent skin healing powers. Ultimately, these insights inspired a range of effective, science-backed skincare.

From observation to vision: How the Blue Lagoon company was born

What began as casual bathing soon became the focus of clinical study, as researchers started analyzing the water’s composition and effects. Early findings revealed a unique blend of bioactive elements, including silica, microalgae, and minerals. In 1987, Reykjavík physician Grímur Sæmundsen began to envision a more formal future for the lagoon, a future rooted in health, wellbeing, and scientific research. This work ultimately led to the founding of Blue Lagoon Limited in 1992, a company rooted in wellbeing and driven by science from the very beginning.