Tephra-dated, high-resolution pollen profiles from Ketilsstaðir, southern Iceland, indicate a largely unwooded pre-settlement environment, a probable consequence of the exposed coastal location. The degree of change associated with the Norse landnám is more limited than in many Icelandic pollen diagrams. There are three main periods of change in the post-settlement vegetational development of the area. Firstly, Norse settlement affected the hydrology of the bog, resulting in the near-disappearance of Sphagnum and agricultural activity led to a reduction of some species (e.g. Angelica spp. and Salix). Secondly, the establishment of probable permanent settlement in the mid-11th century AD initiated expansion of such apophytic taxa as Plantago spp. Lactuceae, Ranunculus spp. and Pteridophytes. Thirdly, the ≥ 10 cm thick Katla tephra, deposited in AD 1357, enhanced drainage of the bog surface, favouring dryland taxa (e.g. Poaceae, Galium and Lactuceae). The tephra deposit and the associated drainage probably caused or contributed to the local extinction of the wetland beetle Hydraena britteni. The study has enabled a series of natural and humanly-related issues to be addressed including tephra-vegetation relationships, the anthropogenic reduction in plant diversity, and comparisons between historical and environmental settlement records.