The main town in Ölfus is Þorlákshöfn, west of Eyrarbakki. The town is important as a port because the only viable harbour on Iceland's southern coast between Grindavík in the west and Höfn in the east is situated there. The town has a population of about 1500 people.
The industrial foundations in Þorlákshöfn are ship-outfitting and fish processing factories, with business and service industries growing fast. Leisure opportunities for tourists are excellent, with an outdoor swimming pool with hot baths, a steam bath and a brand new waterslide. A good campsite is next door to the pool, with indoor cooking facilities and spaces for mobile homes. From the swimming pool you can select many walking routes in the surrounding area and longer walks along the coast, leading all the way to Selvogur and Herdísarvík, and along the beach leading to Óseyrarbrú and Eyrarbakki. In the Egilsbúð library and museum items that tell the story of the development of the town are to be found.
The town church in Þorlákshöfn is built in a unique style, and Strandarkirkja church in Engilsvík in Selvogur is famous as a place for vows. Anyone wishing to go caving has the Raufarhólshellir caves, which are some 1360 metres long. Duggan in Thorlákshöfn and Skíðaskálinn in Hveradalir offer many services to travellers, among them food and drink.