Learn Icelandic: Mér finnst þessi litur fallegur.

Þessi means "this" and it has to match the gender of the noun it points to. Litur (color) is a masculine noun, so we use the masculine form þessi. If the noun were neuter, like hús (house), you would use þetta instead.

Why does the sentence start with mér instead of ég?

The phrase mér finnst is how you express a personal opinion in Icelandic, meaning "I find" or "I think". It works a bit like saying "it seems to me". Because of this, the person having the opinion must be in the dative case, changing ég (I) to mér (to me).

If mér is in the dative case, what case is þessi litur in?

It is in the nominative (default) case! With verbs like finnast (to find/think), the thing you are expressing an opinion about—in this case, the color—stays in the nominative case.

Why does fallegur have an -ur ending?

Adjectives in Icelandic change to match the gender, number, and case of the noun they describe. Since litur is a masculine, singular noun in the nominative case, the adjective must take the masculine nominative singular ending -ur, making it fallegur.