The groups had been admiring the Breiðamerkurjökull glacier in Vatnajökull National Park when a loud cracking sound could suddenly be heard.
Stephen Mantler, who filmed the incident on Sunday, said the sound was a warning that a glacier calving - the natural process where a large section of ice breaks away - was imminent.
The mountain guide, who owns Icelandic tour company Hafjall, filmed tourists running to higher ground for safety as the wave hurtled towards where they had just been standing.
He said he made sure all of his clients were safe and kept an eye on the group, who were also with guides, below as he recorded.
Mr Mantler said the area, in southeastern Iceland, was only accessible with a trained mountaineer.
He told CNN: “While calvings are fairly frequent at this time of the year, this was an extraordinarily large event and much closer to the shore than usual, which is why it was such a close call.”
The business owner said everyone is briefed about what to do in the event of calving before they set off to see the glacier.