AbstractIncreased rates of deformation and seismicity are well-established precursors to volcanic eruptions, and their interpretation forms the basis for eruption warnings worldwide. Rates of ground displacement and the number of earthquakes escalate before many eruptions^1–3, as magma forces its way towards the surface. However, the pre-eruptive patterns of deformation and seismicity vary widely. Here we show how an eruption beginning on 19 March 2021 at Fagradalsfjall, Iceland, was preceded by a period of tectonic stress release ending with a decline in deformation and seismicity over several days preceding the eruption onset. High rates of deformation and seismicity occurred from 24 February to mid-March in relation to gradual emplacement of an approximately 9-km-long magma-filled dyke, between the surface and 8 km depth (volume approximately 34 × 10⁶ m³), as well as the triggering of strike-slip earthquakes up to magnitude M_W 5.64. As stored tectonic stress was systematically released, there was less lateral migration of magma and a reduction in both the deformation rates and seismicity. Weaker crust near the surface may also have contributed to reduced seismicity, as the depth of active magma emplacement progressively shallowed. This demonstrates that the interaction between volcanoes and tectonic stress as well as crustal layering need to be fully considered when forecasting eruptions.