Selfoss sits on the Ring Road, about 60 km east of Reykjavík. It's also well connected by roads to the towns on the south coast and to Upcountry Árnessýsla.
The Reykjavík bus system, Strætó runs buses to Selfoss. The route is number 51 and buses leave from Mjódd interchange station in Reykjavík, goes through Hveragerði and terminates at Fossnesti in Selfoss. One ride between Reykjavík and Selfoss costs 1,400 kr. and buses leave close to once every hour during weekdays, less frequently on weekends.
There are also buses that run between Selfoss and Eyrarbakki and Stokkseyri on the south coast, with several stops in each town. The schedule is rather irregular so it's best to ask around locally.
Finally, it should also be mentioned that many Golden Circle buses run through Selfoss
