Anisotropy of magnetic susceptibility (AMS) and rock magnetic studies have been made on three outcrops separated by 12 km along strike (NNE–SSW) on the Streitishvarf composite dike in east Iceland. Samples for this study have been collected from the inner quartz-porphyry part of the dike, which show clear field evidence of a lateral flow component from north to south at one of the sites. This flow component is consistent with margin AMS results from all three sites. The quartz-porphyry has a substantial bulk magnetic susceptibility (10-2 SI) mainly carried by magnetically soft titanium-poor titanomagnetite (MDF 15 mT). The ferrimagnetic grains yield a characteristic remanent magnetization in all three sites which gives a virtual geomagnetic pole at latitude 52:6°S and longitude 319:6°E. The degree of anisotropy is low (PJ = 1:033) and the magnetic fabrics shifts from oblate to prolate shapes depending on dike margin and outcrop. The magnetic fabric has been interpreted according to the imbrication model, using the minor susceptibility axis as shear plane indicator. The absolute directions given by the minor susceptibility are then quantified using vector algebra. The magma flow is indicated as an upward directed flow, flowing from north to south with an inclination between 30° – 64°, with a 95% confidence ellipse of 3° – 9°. A model for the intrusion of the Streitishvarf dike has been constructed where a magma pocket with felsic magma is punctured by a mafic dike, enabling the felsic magma to rise and extend to the south within the pathway created. The results of this study confirm the applicability of AMS in studies of magma flow directions in igneous dikes of felsic composition.