There are several recreational areas available in and around Grundarfjörður. Þríhyrningurinn, the “triangle”, is a small, sheltered park that is sometimes used as a venue for celebrations and gatherings. Paimpol Park is a green area named after Grundarfjörður’s French twin town.

The Grundarfjörður Youth Association, UMFG, together with the local community, built a sports field with space for spectators which is often used for sports activities and celebrations.

Barbecue facilities are available in the forest area along the Ölkelduvegur road. At Eiði in Kolgrafafjörður, there is a forest which the Forestry Association started in 1990. In Suður-Bár is a 9-hole golf course of the Vestarr’s Golf Club. There are bridle paths outside the town leading from one end to the other.

Melrakkaey is a small island in the fjord of Grundarfjörður, which has been a protected area since 1972. It is a nature reserve where hundreds of sea birds nest during summer. It is forbidden to go onto this island without permission but guided birdwatching tours to the island by boat are available in summer.