Ég skil textann betur þegar ég þýði hann ekki orð fyrir orð.

Because textann is the definite accusative singular form of texti (the text).

• texti = text / a text in the nominative
• textann = the text as a direct object

In Ég skil textann, the verb skil (understand) takes a direct object, so Icelandic uses the accusative. That is why you get textann.

Hann means him/it, and here it refers back to textann.

Since texti is a masculine noun in Icelandic, the pronoun that refers to it is masculine too:

• textann = the text
• hann = it (literally him, grammatically masculine)

So ég þýði hann ekki means I do not translate it.

Because Icelandic normally states the subject separately in each clause.

The sentence has two clauses:

• Ég skil textann betur
• þegar ég þýði hann ekki orð fyrir orð

Even though the subject is the same person in both parts, Icelandic still says ég again, just as English does in I understand the text better when I don’t translate it word for word.

Because skil is the 1st person singular present tense form of the verb að skilja (to understand).

So:

• að skilja = to understand
• ég skil = I understand

This is very common in Icelandic: the dictionary form ends in -a, but the ég form in the present tense is different.

Þýði is the 1st person singular present tense of að þýða (to translate).

So:

• að þýða = to translate
• ég þýði = I translate

In this sentence, þegar ég þýði hann ekki orð fyrir orð means when I don’t translate it word for word.

Because betur is an adverb, and it modifies the verb skil (understand).

You are not describing the noun textann; you are describing how well the speaker understands it. So Icelandic uses the adverb:

• vel = well
• betur = better

Compare:

• Ég skil textann betur = I understand the text better
• betri would be an adjective, used with a noun, like betri texti = a better text

Þegar means when here and introduces a subordinate clause.

So the structure is:

• main clause: Ég skil textann betur
• subordinate clause: þegar ég þýði hann ekki orð fyrir orð

It connects the two ideas: the understanding improves when the speaker does not translate word for word.

This is a very common Icelandic word-order pattern.

In a simple sentence, ekki often comes after the finite verb:

• Ég þýði ekki textann = I do not translate the text

But when the object is a short pronoun like hann, that pronoun often comes before ekki:

• Ég þýði hann ekki = I do not translate it

So hann ekki is natural here. Short object pronouns frequently appear before negation.

It literally means word for word and works much like the English expression.

• orð = word
• fyrir = for
• orð fyrir orð = word for word

It is used to describe very literal translation. In this sentence, the speaker says they understand the text better when they do not translate it in that overly literal way.

Because it expresses a general habit or general truth, not one specific past event.

So Ég skil textann betur þegar ég þýði hann ekki orð fyrir orð means something like:

• this is usually true for me
• this is how I understand texts better in general

That is why present tense is natural in both Icelandic and English here.

They are both normal Icelandic letters.

• þ is like the th in thin
• ð is like the th in this (though its pronunciation can vary depending on position)

From this sentence:

• þýði
• þegar

both start with þ, so they begin with the thin sound.

In orð, the ð is written, but in this position it is very weak and may sound reduced or almost disappear in natural speech.

So for an English speaker, a useful first approximation is:

• þ = unvoiced th
• ð = voiced th

Yes. Icelandic main clauses usually follow the verb-second pattern, but subordinate clauses introduced by words like þegar do not behave the same way.

Compare:

• main clause: Ég skil textann betur
• subordinate clause: þegar ég þýði hann ekki orð fyrir orð

After þegar, the subject ég comes before the verb þýði. That is normal subordinate-clause order.

So this sentence is a good example of how Icelandic word order changes slightly when a clause is introduced by a subordinating word like þegar.