The Embassy of Republic of Iceland was set up in Beijing in 1995, the most significant move in the region after the establishment of bilateral relations with China on 8 December 1971 .

The Icelandic Embassy in Beijing is the first Icelandic Embassy in Asia and Oceanic region and is responsible for Icelandic affairs with China, DPRK, South Korea, Mongolia, Vietnam, Laos, Thailand, Cambodia, Australia and New Zealand.

Bilateral relations have strengthened in the past 13 years with frequent exchanges of many important high-level visits from different ministries, highlighted by the state visit of President Jiang Zemin to Iceland in 2002 and the state visit and working visit of President Olafur Ragnar Grimsson to China respectively in 2005 and 2007.