The ash from Grimsvotn - about 120 miles east of the capital, Reykjavik - turned the sky black Sunday and rained down on nearby buildings, cars, and fields. Civil-protection workers helped farmers get their animals into shelter and urged residents to wear masks and stay indoors. No ash fell on the capital.
Scientists said the eruption was unlikely to have the same impact as last year's eruption 80 miles away at the Eyjafjallajokull volcano, which left 10 million travelers stranded around the world.
"It is not likely to be anything on the scale that was produced last year when the Eyjafjallajokull volcano erupted," University of Iceland geophysicist Pall Einarsson told the Associated Press. "That was an unusual volcano, an unusual ash size distribution and unusual weather pattern, which all conspired together to make life difficult in Europe."
Still, Icelandic air traffic control operator ISAVIA established a 120-nautical-mile no-fly zone around the volcano, closed Keflavik airport, the country's main hub, and canceled all domestic flights. It said Keflavik would stay shut until at least noon Monday, canceling about 40 international flights.
Transatlantic planes, including Air Force One, which was due to carry President Obama to Ireland later Sunday, were told to stay away from Iceland.
The European air traffic control agency in Brussels, Eurocontrol, however, said there was no impact on European or transatlantic flights further south and said it did not anticipate any impact through Monday.
Britain's Meteorological Office, which runs Europe's Volcanic Ash Advisory Center, said the plume from the volcano would spread largely northeast until Monday, but some ash would creep south and east, toward the crowded skies of northern Europe. Where it goes after that depends on the eruption's intensity and weather patterns.
A Met Office spokeswoman said if the eruption continues at its current rate, "the U.K. could be at risk of seeing some volcanic ash later this week." She spoke on condition of anonymity because she wasn't authorized to be quoted by name.