Campaign GPS observations made from 2000 to 2006 at the rhyolitic Torfajökull caldera in south Iceland have been processed, using GIPSY-OASIS software, and analysed in an attempt to create a 3-D elastic half-space model of the interior of the volcano. Current seismicity, resistivity and tilt data for the volcano point towards a cooling magma chamber at 8 km depth below the western part of the caldera, and a shallower magma source in the southeast. The horizontal site velocities show a large effect due to the spreading eastern branch of the Mid-Atlantic ridge that passes through Torfajökull. Hekla volcano approximately 20km to the northwest of Torfajökull, has been inflating since its last eruption in 2000 and is also influencing the site velocities to a small extent. The spreading ridge and inflation of Hekla volcano could be masking any smaller deformation due to the Torfajökull magma sources. Vertical velocity data shows an average uplift of around 15 mm/yr in the caldera. This uplift is most likely due to postglacial rebound, as well as high-temperature geothermal activity within the caldera.