Egilsstadir is a town in east Iceland on the banks of the Lagarfljót river.
It is part of the municipality of Fljótsdalshérad, the county seat of Nordur-Múlasýsla and the largest settlement of the Eastern Region with, as of 2011, a population of 2,257 inhabitants.
Egilsstadir is young, even by Icelandic standards where urbanization is a fairly recent trend compared to mainland Europe. It was established in 1947 as an effort by the surrounding rural districts recognizing it had become a regional service centre. The town, which is named after Egilsstadir farm, is near the bridge over Lagarfljót where all the main roads of the region meet, Route 1 as well as the main routes to the Eastern Region.
Egilsstadir has grown to become the largest town of East Iceland and its main service, transportation, and administration centre. The town has an airport, college, and a hospital. The town grew quickly during the economic boom in the region from 2004 to 2008 associated with the building of the Kárahnjúkar Hydropower Plant and Alcoa's aluminium smelting plant in Reydarfjördur. The growth has slowed markedly since the banking collapse in 2008.
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