I argue here that the special distribution of the Icelandic expletive pronoun, which restricts it to an intuitive 'first position', is due to the interaction of general constraints on Icelandic clause structure and the pragmatic function of a clause containing an expletive. The expletive is not restricted to V2 finite clauses, but can appear in principle in all matrix and embedded finite clauses, as well as certain non-finite clauses. I present an LFG analysis of the full range of facts which adopts a much more linear, relational view of Icelandic syntax than has been widely assumed in generative syntax studies.