Executive summary by darmansjah
Seljalandsfossis one of the most famous waterfalls in Iceland and one of my favourite waterfalls here. It is just off ring-road 1, 120 km east of Reykjavík, turn left on Seljalandsmúli on road 249 (coming from Reykjavík) and drive 1 kilometer and it is right by the road. It is ca 60 meters high and it is breathtakingly beautiful. It is a must visiting Seljalandsfoss when driving the south-coast, you will not regret it. It is possible to walk behind the waterfall, but take care as it can get slippery and you will get wet from the drizzle. I've noticed that English people in particular take the opposite route behind the waterfall, Icelanders always start from the right side but the English from the left side (up the stairs) which leads to people meeting on the narrow path behind the waterfall.
If you want to escape the crowd of people visiting Seljalandsfoss it is best to go there in the evening, you can even get so lucky to have the waterfall just to yourself (if that is what you are looking for) :) You can take a day trip and visit Seljalandsfoss and Skógafoss (30 km east of Seljalandsfoss) and return back to Reykjavík on the same day.