In this paper, we describe a new national language technology programme for Icelandic. The programme, which spans a period of five years, aims at making Icelandic usable in communication and interactions in the digital world, by developing accessible, open-source language resources and software. The research and development work within the programme is carried out by a consortium of universities, institutions, and private companies, with a strong emphasis on cooperation between academia and industries. Five core projects will be the main content of the programme: language resources, speech recognition, speech synthesis, machine translation, and spell and grammar checking. We also describe other national language technology programmes and give an overview over the history of language technology in Iceland.