Following the April 9, 1940, German occupation of Denmark, Iceland took control of its own foreign relations. In July and December of that year Icelandic officials asked the United States to place Iceland under U.S. protection in accordance with the Monroe Doctrine to forestall a feared German invasion of the island. The United States was initially unenthusiastic about this proposal, but ultimately concluded that Icelandic occupation was a matter of national defense and occupied Iceland on July 7, 1941.Modern Flag of Iceland
When German forces occupied Denmark in 1940, Iceland assumed control over its own foreign affairs and gradually moved toward complete independence from Denmark. Following a plebiscite, Iceland formally became an independent republic on June 17, 1944. That same day, the United States recognized Iceland in public statements of congratulation by President Franklin D. Roosevelt and Secretary of State Cordell Hull.
Diplomatic relations and the American Legation at Reykjavik were established on September 30, 1941, when Envoy Extraordinary and Minister Plenipotentiary Lincoln MacVeagh presented credentials and elevated the American Consulate to Legation status. Iceland had taken over full control of its foreign relations on April 10, 1940, although the country had not yet declared itself independent from Denmark, which was then under German occupation.
The American Legation was elevated to Embassy status on November 3, 1955, when John J. Muccio presented his credentials as Ambassador Extraordinary and Plenipotentiary.