Seismic activity has eased in south-west Iceland, but a volcanic eruption is still expected, scientists say.
Although more than 500 earthquakes have hit the Reykjanes Peninsula since midnight, they have been weaker than over the past two days.
But experts stress a 15km-long (9 mile) river of magma running under the peninsula is still active, threatening the now-evacuated town of Grindavik.
Most tremors have taken place under it and hundreds of people have fled.
Cracks have emerged on town roads as the small quakes have caused the landscape to shift and settle.
Officials said on Monday afternoon that Grindavik would remain evacuated overnight, as the situation continues to be monitored on a “minute by minute” basis.
Some inhabitants are being allowed to gather belongings under supervision.
Volcanologists say the latest updates could indicate a smaller impending eruption than was previously thought. It may still put Grindavik in real danger, however, because of the possibility of lava flows.
Authorities emphasise that the situation is very uncertain.
Grindavik is just 15km south of Keflavik International Airport, but flights are still arriving and departing as normal.
Travellers fear a possible repeat of the disruption caused in April 2010, when the Icelandic volcano Eyjafjallajokull erupted.
The resulting ash cloud brought chaos to the European air industry for a whole week, with more than 50,000 flights cancelled.
So far, however, no similar air pollution has occurred.
One man who was forced to abandon Grindavik has said he fears he might never see his home again.
Gisli Gunnarsson, 29, a music composer who was born and raised in the town, told the PA news agency that the situation was “grim”.
His girlfriend Caitlin McLean, from Scotland, who was visiting him at the time, captured the moment on Friday when the furniture and light fixtures shook violently in Mr Gunnarsson’s home.
—BBC
