Satellite radar interferometry has been used to conduct extensive investigations of crustal deformation in SW-Iceland. The Hengill volcanic area has been the main target area, and there a series of interferograms show clearly a concentric fringe pattern, indicative of uplift of 19 mm/year from 1993 to 1998. The uplift is due to an expanding pressure source located at 7 km depth, and is interpreted to be result of magma accumulation. The inflation causes stresses that exceed the Couloumb failure critertion, and the results indicate that inflow of magma into the crust can furnish the primary driving force to actually break rocks on a fault in an earthquake. Furthermore, a new technique has been developed to combine GPS and satellite radar interferometry results in order to produce three-dimensional motion maps, that give an unprecedented view of plate motions. Significant results in applying SAR technique are described under Subprojects 5 and 6.