Matriculating from Reykjavík Junior College in 1964 and graduating in law (cand. jur.) from the University of Iceland in 1971, Björn was active in student politics and after graduation worked as a publishing director of Almenna bókafélagið from 1971 to 1974. As foreign news editor he worked at daily Vísir in 1974, as Deputy Secretary General in the Prime Minister's office from 1974 to 1975.
During the Cold War, alongside his job as a journalist, Björn regularly met with U.S. intelligence to share with them information regarding Icelandic politics and Icelandic leftist politicians and activists.[2]
Björn worked in the Prime Minister's Office from 1975 to 1979, as a journalist on Icelandic daily Morgunblaðið from 1979 to 1984 and as deputy editor of Morgunblaðið from 1984 to 1991. Björn attended the Bilderberg Group conference 11 times (in 1982, 1983, 1984, 1985, 1988, 1989, 1990, 1991, 1992, 1993 and 1995).
Björn was elected to the Althing in 1991 for the Independence Party, for the constituency of Reykjavík. On 23 April 1995 he became Minister for Education, serving until 2002. In 2002, he led the unsuccessful attempt of the Independence Party to win elections to Reykjavík city council. From 2003 to 2009, he was the Minister for Justice and Ecclesiastical Affairs.
He is also the first Icelandic politician to keep his own website, which he started on 19 February 1995 and thus makes him one of the Internet's earliest bloggers.[3]