Since overseas flights from Iceland began, air cargo has played a vital role in the Icelandic aviation industry. Both Loftleiðir and Flugfélag Íslands carried cargo on their commercial flights and with the founding of Icelandair in 1973, a Cargo Department was established. Cargo transportation became an important part of the operation and in addition to offering belly space on Icelandair's passenger flights, a freighter flew weekly to Ostende, Belgium. In 1997 the company started Boeing 737 freighter flights to Cologne in Germany, 6 days a week. Demand soon exceeded supply and in September 1999 Boeing 757 freighter flights to Liege in Belgium and to New York commenced. 

More Boeing 757 freighters have been taken into service and currently 2 Boeing freighters are in service.

Icelandair Cargo sells also the belly capacity of the Icelandair passenger network and since early 2015, Icelandair Cargo operates Air Iceland air freight department, enabling us to offer service to and from around 54 destinations.
To emphasize the importance of the cargo operation within Icelandair, the subsidiary Icelandair Cargo was established in the beginning of 2000 to handle its cargo operation. Furthermore, its expanding cargo operation required the opening of a new warehouse at Keflavik Airport in 2001. The same year its subsidiary, Icelandair Logistics in Liege, Belgium, was founded.

Icelandair Cargo is an international company with its headquarters in Reykjavik, and runs an office and warehouse at Keflavik airport.