Abstract Betula pubescens Ehrh. (mountain birch) is the only forest-forming tree in Iceland. Since human settlement (874 AD), the continuous 25,000 to 30,000 km2 forest has shrunk to 1.200 km2 of fragmented patches, making it a good object to study population genetic consequences of habitat fragmentation and disturbance. Further, genetic studies have also shown that hybridization between the tetraploid (2n = 56) B. pubescens and the diploid (2n = 28) Betula nana L. (dwarf birch) occurs among Iceland’s natural populations. This study assessed the genetic variation within and among 11 birch forests remaining across Iceland. Genotype-by-sequencing methodology provided a total of 24,585 single nucleotide polymorphisms (SNP´s), with a minor allele frequency >5% for genetic analyses. The analysis showed similar diversity within forests, suggesting that fragmentation and hybridization have had a limited effect on the genetic variation within sites. A clear genetic divergence is found among forests from the different regions of Iceland that may reflect historical isolation; the differentiation between forests increased with geographic distances reflecting isolation by distance. Information on the distribution of genetic variation of birch in Iceland is essential for its conservation and to establish genotype–phenotype associations to predict responses to new environmental conditions imposed by climate change and novel biotic/abiotic stressors.