A major volcanic eruption beneath the Vatnajokull ice cap from 30 September to 13 October 1996 melted up to 500m of overlying ice and produced 3.5km3 of water that was later released catastrophically onto the Skeidararsandur outwash plain. Here, we present pre- and post-event topography and velocity field maps of the ice cap surface derived from ERS-1/2 synthetic aperture radar (SAR) interferometry. Within the errors of this method our results reveal local topographic and ice flow variations near the eruption site and incision of a 140m meltwater trench. A 24-hour, 50cm subsidence of the frozen surface of the Grimsvotn caldera lake was also detected. However, despite the large increases in geothermal heat flux and basal meltwater availability associated with this event, there appears to be no regional-scale ice subsidence and little to no alteration in flow dynamics of the Vatnajokull ice cap.