Central southern Iceland is one of the main outlets of the Icelandic Ice Sheet where a MIS 5e sedimentary complex, the Ranga Formation, is extensively observed below the last deglaciation terminal moraines. Sedimentary facies demonstrate that the Ranga Formation is mostly tidal, up to 215 m (transgression I) and 168 m (transgression II) in altitude. The first highstand reworks a thick tephra from the Grimsvotn volcano, known in marine cores as 5e low/Bas-IV and positioned at ca. 127 Ka BP, the Eemian thermal optimum. This formation is related to a rapid deglaciation followed by two marine transgressions marked by the development of extended mud flats, which were separated by a complex regression phase, associated with loess deposition, ca. 9 Ka in duration. Palaeo jokulhlaups, basaltic flows, and tephra fallouts from the Hekla and Grimsvotn volcanoes affected the sedimentation. The Ranga Formation yields one of the first continuous and complete estuarine records of the Eemian interglacial in Iceland and probably for most of the northern terrestrial Atlantic. This estuarine infill records the distal signature of a complex glacial advance within the last interglacial, already well identified in northern and central Iceland. The glacial advance is attributed to the intra-Eemian cooling events (Greenland GS 26 or marine cold events M-C25-C26). It is followed by a warming and a glacial retreat corresponding to the Greenland GI 25 event. This formation allows, in connection with the timing of recognized volcanic periods, a better insight of the interconnections between sea-level, regional glacial extent, and Northern Hemisphere marine and ice core climatic records.