Ég set svefninn í forgang þegar ég er stressaður.

Set is the present tense, 1st person singular form of setja (to put, place, set).

So:

• ég set = I set / I put
• þú setur = you set
• hann/hún/það setur = he/she/it sets

In this sentence, the present tense gives a habitual meaning: I prioritize sleep when I’m stressed.

If you wanted the past, you would say ég setti.

The ending -inn is the suffixed definite article, so svefninn literally means the sleep.

In Icelandic, abstract nouns are often used with the definite article in places where English would simply say sleep. Here, svefninn can be understood as sleep in the general but personally relevant sense, almost like my sleep / sleep as the important thing in question.

So even though English would not normally say the sleep, Icelandic can.

It is the accusative singular, because it is the direct object of set.

The verb setja normally takes an object in the accusative:

• Ég set bókina á borðið. = I put the book on the table.
• Ég set svefninn í forgang. = I put sleep first / I prioritize sleep.

A useful detail: with svefninn, the nominative and accusative happen to look the same in writing, so you do not see a different ending here even though the case is accusative.

This is a very common Icelandic pattern.

With í, the choice between accusative and dative often depends on meaning:

• accusative = movement or change into a state
• dative = location or being in a state

Here, setja ... í forgang means to put something into priority, so it uses the accusative form forgang.

Compare:

• setja eitthvað í forgang = to make something a priority
• eitthvað er í forgangi = something is in priority / is a priority

So the sentence uses í forgang because it expresses a change: sleep is being placed in that priority position.

It is an idiomatic expression meaning:

• to prioritize
• to give priority to
• to put first

So Ég set svefninn í forgang means something like:

• I prioritize sleep
• I put sleep first
• I make sleep a priority

This is a good phrase to learn as a chunk: setja eitthvað í forgang.

Because stressaður is an adjective describing the subject ég, and Icelandic adjectives must agree with the person or thing they describe.

Here, the speaker is understood to be masculine singular, so the adjective is:

• stressaður = masculine singular

Since it comes after er, it is a predicate adjective:

• ég er stressaður = I am stressed

If the speaker were female, it would change form.

A woman would normally say:

Ég set svefninn í forgang þegar ég er stressuð.

The only change is:

• stressaður → stressuð

That is because the adjective must match the speaker’s gender.

So:

• masculine speaker: ég er stressaður
• feminine speaker: ég er stressuð

Here, þegar means when.

It introduces the subordinate clause:

þegar ég er stressaður = when I am stressed

Because the main verb is in the present tense and describes a repeated pattern, þegar here can feel like when or whenever in English:

• I prioritize sleep when/whenever I’m stressed

Yes. You can put the þegar-clause first:

Þegar ég er stressaður, set ég svefninn í forgang.

That still means the same thing.

Notice the word order in the main clause after the fronted subordinate clause:

• set ég
• not ég set

That happens because Icelandic main clauses usually follow a verb-second pattern.

So both are correct:

• Ég set svefninn í forgang þegar ég er stressaður.
• Þegar ég er stressaður, set ég svefninn í forgang.

Yes, it is a very common modern Icelandic word, although it is clearly based on the international/English word stress.

Icelandic often takes borrowed roots and gives them Icelandic endings and grammar. So stressaður behaves like a normal Icelandic adjective:

• ég er stressaður
• hún er stressuð
• þeir eru stressaðir

So even though its origin is not old native Icelandic, it is completely normal in everyday Icelandic.