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The eruption began in the early afternoon after a series of earthquakes north of Grindavik, a coastal town of 3,800 people that was also evacuated.
The weather service said lava was shooting about 50 meters into the sky from a fissure about a kilometer long.
The Blue Lagoon thermal center was evacuated before the eruption began, national broadcaster RUV said.
Earlier this month, the Blue Lagoon and Grindavik were also evacuated after a volcanic eruption on the country’s Reykjanes peninsula, Icelandic public broadcaster RÚV reported.
The lava appears to be flowing rapidly north of the town of Grindavik, just as it did during the eruption on February 8, RÚV said, citing the Icelandic Meteorological Service.
Just less than an hour’s drive from Iceland’s capital and largest city, Reykjavík, the Blue Lagoon is one of the country’s most popular tourist attractions.
The site is part of southwest Iceland’s Reykjanes Peninsula, a thick finger of land pointing west toward the North Atlantic Ocean from Reykjavík.
Northern lights shine over the erupting Icelandic volcano
Iceland is one of the most active volcanic areas on the planet.
Instead of having a central volcano, the Reykjanes Peninsula is dominated by a rift valley with lava fields and cones.
In November, it was closed for a week after 1,400 earthquakes were measured in 24 hours.
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