Malmey is the larger of the two islands of the Skagafjord Bay. It is situated to the northeast of island Drangey. It is about 4 km long, and 2,4 km wide, and relatively flat and rises towards north to 156 m above sea level. The structure of the southern part is hyaloclastite and the northern part shows the remnants of a shield volcano, which probably erupted early in the ice age. The island was inhabited until about 1950, when a fire destroyed the farm. At that time, 14 people lived on the island, thereof 10 children. The island is well vegetated and the farmland was considered very good. An ancient spell made it impossible for mice and horses to thrive there and no married couple should stay there longer than 20 years or the wife would disappear.

According to the legend, one housewife of Malmey disappeared. This event is better explained under the title "Hvanndalabjarg". There was a church on Malmey until the latter part of the 18^th century. A covenant from 1318 states, that a light should always be left burning in the church during winter for the seafaring people. The island is the property of The Lighthouse and Port Authority and the present lighthouse there was built in 1937.

The Sturlunga Saga tells the story of bishop Gudmundur Arason the Good and his persecutors. In 1221, they drove him away from the Episcopal seat at Holar during advent, and he spent a few months with his followers on Malmey. A few of his men went discretely back to Holar and killed the leader of the persecutors, Tumi Sighvatsson. After that Gudmundur moved to the island Grimsey on the polar circle and stayed there until his persecutors sent a small army to take vengeance on him.
Hofsos