I took this picture in Nauthólagil. It’s a narrow canyon with a healthy stream of water coming down it. The walls are 10-20 meters high and there are trees above it so it feels almost completely enclosed like a cave. You can easily walk to this place without getting wet and if you scramble up along the edge here you will have to wade the rest of the way. In there there is a beautiful waterfall. On the way back you can jump off the edge of this little waterfall into deep water. Lots of fun.
Finding this is not easy. There is a small sign that points to it by the last farm field on the way into the Þórsmörk Valley in southern Iceland. The sign says Nauthólagil. From there you drive a few hundred meters to the mouth of the narrow canyon. Have fun and stay safe.