Egilsstaðir is a town in east Iceland on the banks of the Lagarfljót river. It is part of the municipality of Múlaþing and the largest settlement of the …Egilsstaðir is a town in east Iceland on the banks of the Lagarfljót river. It is part of the municipality of Múlaþing and the largest settlement of the Eastern Region with, as of 2020, a population of 2,522 inhabitants. Formerly Egilsstaðir was part of Norður-Múlasýsla.