A tiny little city stuck right on the edge of the Arctic circle may sound more like a place where you'd hope your cheating ex-partner would disappear to rather than somewhere you'd go for a weekend of hedonistic revelry but you'd be wrong.

Indeed, what the unkempt but nonetheless charming city of Reykjavík lacks in size, it makes up in its reputation as a place to party until your weary body can take no more.

You'd expect the world's most northerly capital to have something a little bit different from all other cities and Reykjavík doesn't disappoint on that front. There are few places where you can sit yourself down with a coffee and see the mountains looming over one shoulder and the sea braking on the other, whilst a gaggle of low flying geese circle around your head.

The younger Icelandic generation appear to share their British counterparts’ penchant for binge drinking with a runtur – a drunken pub crawl round half a dozen bars - being the staple of a good Friday night out. Most bars are on or just off Austurstraeti and Laugavegur, including the trendy Kaffibarinn, which is part-owned by Blur's Damon Albarn. Opening hours are long and drinks are expensive but the general consensus says the experience is worth the financial damage and sleepless nights.

But during the day, the city has a quiet, relaxed air where the pace of life may be slower but no less expensive. The centre is more suburban than urban with rainbow-coloured houses replacing the usual towering sky scrapers and a distinct lack of beeping traffic on the well-swept roads. Head to the thriving main drag of Laugavegur for a spot of window shopping in some of the elegant boutiques – but unless you're used to life in the lap of luxury then you'll need something to prop your mouth shut after you've seen some of the prices.

A visit to Tjörnin is a must for budding ornithologists or those who want to get close and personal with an arctic turn – the birds are notorious for their random dive-bombing attacks. For something a little more out of the ordinary, a visit to the Icelandic Phallalogical Museum, home to a collection of over 100 mammal penises will prove an unforgettable experience.

For a birds-eye view of the city, head to Reykjavík's defining landmark, a gargantuan white concrete church known as the Hallgrímskirkja. Those who are taken with the idea of going for a gentle stroll around a flat and treeless island should make the ten minute boat ride to Viðey. Just remember to take your camera as the spot offers fantastic views of the city and the nearby mountains.

But many of the best attractions are outside of the city centre. A short bus ride will take you back to nature with the spouting jets and waterfalls of Geysir and Gullfoss.

Those feeling a little more adventurous can head further a field to the Reykjanes peninsula to cast their eyes over the expanse of bleak lavafield. Granted, it's not much of a visual feast but Iceland's famous Blue Lagoon will soon get you over any disappointment.

Reykjavík is far from being a budget destination but if you're going to splash out you might as well go somewhere that leaves a lasting impression. The only problem is, with all that partying, you're probably not going to be able to remember a thing.