For a week now, the town of Grindavik [Google Earth] in Iceland has been ravaged by underground volcanic activity. It's a fishing town situated southwest iceland along the coast. It's on the Reykjanes peninsula which is the youngest area of Iceland formed 2000-3000 years ago from volcanic activity.

In early November, uplifting occurred to the northwest of Grindavik. On Thursday November 9th, larger quakes were recorded to the northeast of Grindavik. These earthquakes spread to the southwest through the town and out into the ocean. At the same time, a noticible depression was now present.

Scientists concluded that a new magma chamber had formed. It was 9.5 miles long at ~1/2 mile below the surface [15 kilometers at 800 meters]. A large portion of it was centered directly underneath Grindavik's western edge, its residential district.

A state of emergency was declared and the entire town (excepting emergency workers) was evacuated. This displaced approximately 1% of their entire population. There was a brief window where some people got back in to gather some personal effects\pets\etc., and only to the eastern part of town, but conditions have worsened and there is no access.

Presumably, the initial flow caused the landmass the town sits on to raise up. The magma then retreated (maybe back northeast) leaving a void and causing subsidence. This shifting (and the subsequent hundreds of earthquakes a day) have practically sealed the towns fate already. Cracks have become fissures and houses are skewing. Their infrastructure and their very ground is taking serious damage. It is a disaster of epic proportion.

Sadly, the worst may be yet to arrive. Everyone is still very unsure about specifics regarding magma turning into lava, but the general scientific concensus is that an eruption is both likely and imminent. When's and where's are largely unknown, though it if breaches under the ocean, things get even more complicated. A seafloor breach would create a more unpredictable and explosive scenario. The model I saw gave high probability to a series of vents northeast of Grindavik (the Hagafell region?) as the most likely, but the local folks seem to think that Grindavik itself is the most likely place for an eruption. Others say that it will sink into the sea.

There are live broadcasts of the area that feature multiple camera angles and live earthquake mapping. A more detailed scientific explanation from geology professor Shawn Willsey.