Iceland captain Aron Gunnarsson credited his team's 'Viking spirit' for hauling it into the last 16 of UEFA EURO 2016 with a last-gasp 2-1 win over Austria in Saint-Denis.

The tournament debutant began with its now customary confidence and Johann Gudmundsson had rattled the post with a thunderous drive by the time Jon Dadi Bodvarsson poached an 18th-minute opener.

Austria began the match with an experimental 3-4-3 set-up and struggled for fluency, but unlikely centre-forward David Alaba won a 37th-minute penalty that Aleksandar Dragovic dragged against the post.

Coach Marcel Koller reverted to the 4-2-3-1 that helped Austria to nine wins from 10 qualifiers and it was much improved during the second half, when substitute Alessandro Schopf restored parity with a stunning solo goal.

Iceland was forced to dig deep as its opponent piled on the pressure but Elmar Bjarnason streamed clear deep into stoppage time and crossed for fellow substitute Arnor Ingvi Traustason to seal the points, second place in Group F and a dream knockout clash against England.

Cardiff City midfielder Gunnarsson neglected to turn the air as blue as Iceland's shirts when recalling a gruelling closing half-hour.

Asked whether it felt like the longest 30 minutes of his career, he said: "Without swearing, yeah it was! I started seeing stars but as soon as we scored the winning goal it was an unbelievable feeling.

"It was always going to be a hard game, they had to push on because if they didn't win they didn't qualify. 

"It's a shame because Austria are a good team, they put us back a little bit but that's our Viking spirit, we keep fighting until the end."

Iceland's entire team and backroom staff streamed on to the field to celebrate Traustason's goal and their vociferous support remained jubilant inside the stadium long after the final whistle.

"It's hard to describe," Gunnarsson reflected. "It's something that we've dreamt about and it's something that other players want to treasure for the rest of our lives. Our aim was to get to the last 16 and now we have to set a new target."