Are you planning a sunny holiday in the Algarve and looking for where to stay? Here is a complete guide to the 8 best towns in this stunning region of Portugal, with the top eco-resorts in each area.
From pristine sandy beaches to unique golden cliffs and traditional fishing villages, the Algarve has plenty to offer as one of the top summer destinations in Europe, whether you want to relax or enjoy water sports.
I discovered the Algarve in spring during one of my solo road trips. I rented a car and explored the coast, from Faro to Lagos, and it was incredible. I stayed in a different town each night and stopped regularly along the way to experience the best of the Portuguese region.
Wherever you decide to stay during your trip, you will have a fantastic time! Plus, everything is easily accessible by car, bike or bus. So do not worry too much, but if you have any questions, send me a message.
Are you ready? Let’s dive into the 8 best towns and eco-friendly hotels to stay in the Algarve, no matter if you are staying for one night, a weekend or a week.
My Algarve experience:
Duration 5 Days
Dates visited May 01 - May 05
Season Spring
Where I stayed Faro, Carvoeiro & Lagos
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Overview: the 8 best towns in the Algarve
- Lagos: the best area for first-time visitors
- Faro: the best area for city life
- Albufeira: the best area for nightlife
- Carvoeiro: the best area for families
- Sagres: the best area for surfing
- Ferragudo: the best area for couples
- Tavira: the best area for a quiet stay
- Salema: the best area for outdoor activities
Looking for the best Algarve road trip itinerary? Check out this article:
Algarve Portugal Road Trip: Epic 5-Day Itinerary
Top areas to stay in the Algarve – Map
Click on the top left of the map to display the list of stops and locations.
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Where to stay in the Algarve: 8 best areas
In this article, you will also find the best things to do, what to see and the top green hotels in each location. I selected these accommodations by researching on ETIC Hotels, Ecobnb and bookdifferent by carefully reading their website and looking for green certification.
However, I understand these hotels are not the cheapest and the most budget-friendly places to stay in the Algarve, but they are the most eco-friendly. Unfortunately, mixing the two is not always easy, and I have tried to select accommodations that focus on making a difference whilst being affordable. If you have any other suggestions, please let me know in the comments below.
Looking for the best beaches in the Algarve? Check out this article:
10 Most Beautiful Algarve Beaches, Portugal
1- Lagos: the best area for first-time visitors
Located in the southwest of the Algarve region of Portugal, Lagos is known for its old walled town, rugged cliffs and tourist-friendly beaches. It is a popular spot in the Algarve due to its iconic coastline, where dramatic rocks jut out of the water and offer spectacular views of the Atlantic Ocean from the clifftop.
Lagos is also a vibrant nightlife hotspot, with many bars, restaurants and places to enjoy a drink or two!
Popular with first-time visitors, this charming town has a good mix of activities and attractions to keep everyone entertained. The Old Town is the perfect place to enjoy a stroll and soak up traditional Portuguese architecture, and the stunning nearby beaches are some of the nicest in the Algarve – whether you are visiting in summer or winter.
One of the most iconic things to do is to marvel at the dramatic Ponte da Piedade. This famous promontory features beautiful limestone rock formations made up of arches, caves and more. Admire the breathtaking views from the top or head down the narrow stairs to the platform for a close-up viewpoint. Boat trips and kayak tours are popular here for good reason.
The equally stunning Praia do Camilo is a small beach accessible only by descending 200 wooden steps – challenging but worth it, especially romantic for couples at sunset!
And on your wander through the Old Town, do not miss a trip to the glittering golden interiors of Igreja de Santo António Church – an ornate 18th-century church and national monument of Portugal, located opposite the Castelo dos Governadores, a castle with a baroque facade and watchtowers.
Best eco-resort in Lagos: Casa Vale da Lama Eco Resort
Located just outside Lagos, a 15-minute drive away, you will find Casa Vale da Lama Eco Resort in the peaceful Portuguese countryside. This stunning farmhouse has been designed to be a perfect balance between quality hospitality and sustainability whilst retaining its authentic features.
Their sustainable commitments include growing organic vegetables, providing valuable education through nature experiences and community-building activities and future-proofing the health and abundance of the land through regenerative practices.
📍 Quinta do Vale da Lama, 8600-258 Odiaxere, Lagos
⭐️ 4.7/5 (Google reviews)
💵 Contact the property
2- Faro: the best area for city life
Located in the eastern Algarve, the capital and main gateway to the region is a fantastic city with more to offer than just its airport. With historical sites, cultural attractions and proximity to beautiful beaches, Faro is the perfect place to enjoy the city life with a slice of beach fun.
City dwellers will enjoy wandering the picturesque Old Town with its maze of cobbled streets, fantastic 18th-century architecture and charming alleyways. Walk through the stunning monumental arch Arco da Vila, the entrance to the Old Town, or take a break and people-watch one of the many charming squares – it is the perfect way to cool off from the Portuguese heat.
Do not miss a visit to the Faro Archaeological Museum to learn more about the extensive history of the city. And for a unique experience, head to the Igreja de Nossa Senhora do Carmo church, one of the most beautiful churches in the Algarve, which has an extraordinary Bone Chapel, filled with the skulls and bones of over 1000 monks – a macabre but fascinating spot.
And when you need a break from the heat of the city, head to the beautiful shores of the Algarve to cool off. For pristine beaches and little to no tourists, visit the stunning sandbar islands of Ilha do Farol, Culatra or Deserta.
Ilha de Farol is the best spot for a more popular beach with amenities and restaurants. With water sports activities, sun beds, lifeguards and beach bars, this is a great place for families with children.
Best eco-resort in Faro: Sunlight House
Located on the edge of the historic centre of Faro, you will find this cosy and friendly Bed and Breakfast accommodation, just a few minutes walk from the main avenue, harbour, shopping street and main attractions. It benefits from a prime location to enjoy everything the city offers.
The B&B is also committed to sustainability, which includes a zero-waste policy through the use of recycled materials and better waste management, such as donating food to homeless people living in the area as well as hygiene products left by guests.
📍 R. Dr. Francisco Lázaro Cortes 11, Faro
⭐️ 4.5/5 (Google reviews)
💵 From £120 per night
3- Albufeira: the best area for nightlife
Albufeira, located in the middle of the southern Algarve coast, is the largest, liveliest and most popular destination in the region. This former fishing village is now a major tourist spot, with thousands of travellers flocking here during the hot summer months to enjoy the stunning beaches and vibrant nightlife.
A magnet for young tourists eager to party the night away, Albufeira has a bustling ‘Strip’ located in the Montechoro area of the town, full of food outlets, bars, pubs and clubs. Popular with young adults and hen/stag dos, Albufeira is the party hub of Portugal and the main attraction, aside from its gorgeous beaches.
However, it is not just about the parties in Albufeira. Spend an afternoon wandering around the fascinating Old Town with its maze of alleyways and charming squares, and stop by Largo Engenheiro Duarte Pacheco, one of the most popular squares where you can shop for souvenirs or sit back with a drink and people-watch.
Stroll the colourful Albufeira Marina with its Lego-like buildings and pastel tones, and do not miss a visit to some of the best beaches in the Algarve. Praia de Albufeira is the long stretch of sand within the town, which features sun beds and parasols to rent, beach bars and cafés, and dazzling waters to dip in.
And if you feel adventurous, take a boat tour of the nearby coastline and explore delights such as the fascinating Benagil Cave and the beautiful rugged cliffs of the Algarve. It is also an excellent opportunity to spot dolphins, often seen in these waters.
Best eco-resort in Albufeira: Hotel PortoBay Falesia
With direct access to Praia da Falésia beach, Hotel PortoBay Falesia welcomes you to a peaceful atmosphere surrounded by swimming pools, large green spaces, beautiful cliff views, comfort and delicious local cuisine.
As a Green Key-certified hotel, its commitment to sustainability includes energy efficiency plans, recycling, better waste management, reducing water consumption and giving preference to local suppliers.
📍 Quinta do Milharó, Olhos de Água, 8200-591 Albufeira
⭐️ 4.5/5 (Google reviews)
💵 From £210 per night
4- Carvoeiro: the best area for families
Located between Lagos and Albufeira, Carvoeiro is a traditional Portuguese town set in a picturesque horseshoe-shaped bay. Considered to be one of the most beautiful beaches in the Algarve, the stretch of sand in this former fishing village is surrounded by white-washed buildings nestled along this beautiful bay.
The charming setting of the town and relaxed vibe make it a wonderful spot for families who want a quieter holiday with a slower pace of life. During the summer months, the town and beaches are busy, but not crowded, and with a calmer and more authentic feel, it is the perfect destination to bring little ones.
The main attraction here is the gorgeous Praia de Carvoeiro. Small, but perfectly formed, this beautiful stretch of beach has calm waters, lifeguards and plenty of amenities – suitable for families and children. Other notable beaches are Praia da Marinha and Praia do Carvalho, although these are more difficult to reach with younger children.
After a long day in the sun, head into the town to browse the shops and relax in one of the many bars and restaurants. Or keep active with a scenic walk along the Carvoeiro Boardwalk, built along the nearby cliffs.
And to keep the little ones cool, the Slide and Splash water park is a fantastic day trip featuring 17 different attractions and waterslides. kids (and adults!) will be entertained all day.
Best eco-resort in Carvoeiro: Tivoli Carvoeiro
Overlooking the Atlantic Ocean on the Vale Covo cliffside, this fully-renovated 5-star hotel offers a luxury stay not far from the top attractions such as the Slide & Splash Parque Aquático, ideal for families with children looking for a memorable holiday.
Its sustainable policy is structured around three axes: human development, environmental protection and development of the local economy. They take an active role in the local community, work to reduce their carbon footprint and invest in authenticity through innovation.
📍 Estr. do Farol 5, 8401-911 Carvoeiro
⭐️ 4.6/5 (Google reviews)
💵 From £200 per night
5- Sagres: the best area for surfing
Sitting on the extreme southwestern tip of Portugal, Sagres is a remote town featuring dramatic landscapes, windswept beaches and unique rock formations. Often referred to as the end of the world, the rugged coastline of this region was formed by the powerful waves of the Atlantic Ocean. You can see where its end-of-the-world name comes from!
The windy weather of Sagres makes it an ideal spot for surfing and attracts thousands of surfers every year who head to the area to enjoy the spectacular swells and catch a wave.
You will find many surf schools offering lessons and equipment rental, as the waves here attract some of the best surfers in the world. But whether you are a complete beginner looking to get into surfing or are an expert in the sport, this is the best place in the Algarve for you.
And do not forget to explore the relaxed town of Sagres to rub shoulders with the surfing elite. It is not your typical holiday resort – you will not find cheesy souvenir shops and tons of cocktail bars, but instead, you will find a low-key atmosphere with an emphasis on the surfing lifestyle.
Head to Praia da Mareta – the main beach of Sagres, suitable for everyone from surfers to sunbathers. Praia do Beliche is another gorgeous spot with unique rock caves and plenty of waves.
Visit Cabo de São Vicente to marvel at the magnificent ‘end-of-the-world’ cliffs and watch the sun set behind the red-tipped lighthouse of the same name.
Finally, history buffs will enjoy a visit to the historic Fortaleza de Sagres – a 15th-century fortress built to protect against pirates travelling from North Africa.
Best eco resort in Sagres: Memmo Baleeira
Set in a scenic natural park overlooking the Atlantic Ocean, this contemporary and upscale hotel is a 2-minute walk from the beach and a 13-minute walk from Sagres Point. It is the ideal spot for a relaxing vacation mixed with a surfing experience.
Its commitment to sustainability includes: reducing its use of plastic, implementing a zero-waste policy, protecting the authenticity of its surroundings and providing local food that respects the ecosystem.
📍 Sitio da, 8650-357 Sagres
⭐️ 4.6/5 (Google reviews)
💵 From £180 per night
6- Ferragudo: the best area for couples
Located between Lagos and Albufeira, the town of Ferragudo is a traditional fishing village featuring whitewashed houses, flower-covered buildings and relaxed Portuguese charm. Retaining many of its traditional elements compared to some of the other towns on the Algarve, this picturesque town sits at the mouth of the Arada River and is a quiet, gentle spot with riverside appeal.
The relaxed, slower pace of life and idyllic location of Ferragudo attract couples who want to escape the hustle, bustle and party atmosphere of some other resorts whilst still being close to the best beaches and fantastic attractions of the Algarve.
Wander the charming cobbled streets of the town, admiring the whitewashed buildings splashed with gorgeous hues of yellow and blue. The beautiful Igreja de Ferragudo Church is a fantastic example of this colourful display. Enjoy a romantic al fresco meal in one of the many rustic restaurants of the town – Praça Rainha Dona Leonor is one of the most beautiful squares with a lively atmosphere.
And nothing says romance like a boat trip – it is one of the best things to do in Ferragudo. Explore the nearby coastline and attractions, such as the Benagil Caves and rugged cliffs that make up the Algarve.
Finally, if you are more into beaches, head to Praia do Pintadinho and Praia dos Caneiros, where you can also go on a hike to the Ferragudo Lighthouse and snuggle up as the sun goes down – it is the perfect holiday date night activity!
Best eco-resort in Ferragudo: One2Seven
Located on the opposite bank of Portimão along the Arade River, this contemporary hotel is the ideal place for a romantic couple getaway. Promoting slow living, the hotel allows you to sunbathe by the swimming pool, relax in a modern room or take part in a tailor-made activity.
With a strong emphasis on slowing down and living like a local, the hotel is committed to sustainability through measures such as efficient water and energy consumption, better waste management and organic food.
📍 Cerca do Moinho, 8400-222 Ferragudo
⭐️ 4.9/5 (Google reviews)
💵 From £200 per night
7- Tavira: the best area for a quiet stay
Situated on the eastern side of the Algarve, on the Gilão River, the peaceful town of Tavira is the ultimate relaxing holiday destination. Benefitting from fewer tourists than the western part of the Algarve, Tavira is an irresistible blend of traditional Portuguese elements, Moorish influence and lots of outstanding areas of natural beauty.
This charming town is ideally suited for travellers looking for a quiet and peaceful holiday. Nature lovers especially, will enjoy exploring the lagoons and waterways of Ria Formosa Natural Park, which attracts plenty of wildlife.
Whilst the town is within easy reaching distance to some pretty beaches perfect for families, most of the attractions lie within Tavira itself. It is a fascinating city with a wealth of history and authentic charm. Wander the pretty riverside and admire the beautiful whitewashed Roman Bridge – an iconic landmark of Tavira. And after a long day of exploring, choose a seat in one of the many riverside cafés to watch the world go by.
You can also explore the remains of the Moorish Tavira Castle and the city walls. Climb to the top of the walls, marvel at the city views and wander the gardens of the Castelo with its pretty flower-covered features.
In addition, do not miss a visit to the stunning Igreja de Misericórdia. Considered one of the most beautiful churches in the Algarve, you can find the iconic blue and white azulejo tiles of Portugal depicting religious images.
Best eco-resort in Tavira: Al-Gharb Tavira Eco GuestHouse
Located in the heart of Tavira, Al-Gharb Tavira Eco GuestHouse is an eco-friendly accommodation with a strong commitment to sustainability. It offers private rooms on the banks of the Gilão River, just a 5-minute walk from the city market where you will find fresh local produce.
Renovated with recycled materials, the several air-conditioned rooms are colourful, with some providing views of the river whilst others have a private terrace. In addition, the water in each bathroom is heated using solar panels.
📍 R. dos Pelames n°1, 8800-411 Tavira
⭐️ 4.2/5 (Google reviews)
💵 From £130 per night
8- Salema: the best area for outdoor activities
Located in the west of the Algarve, between Sagres and Lagos, Salema is a working fishing village set within the Costa Vincentina National Park. Relatively unspoilt and undeveloped, the town has a charming authentic feel with gorgeous quiet beaches and an abundance of outdoor activities to enjoy. Often considered the ‘hidden gem’ of the Algarve, this is a fantastic destination for families, couples and active travellers.
Salema is an ideal place for travellers who are partial to partaking in water sports and water-based activities. From paddle boarding and kayaking to surfing, snorkelling, diving and more – you will be spoilt for choice.
Praia da Salema is the star of the show. This beautiful stretch of sand features calm, shallow waves perfect for swimming and water activities, such as paddle boarding and kayaking. A unique thing to see at this beach is also the fascinating 150 million-year-old dinosaur footprints, which can be seen on the cliffs.
Finally, the magnificent coastline of the Algarve lends to some stunning coastal hikes that traverse the edges of this dramatic landscape. With incredible views of the Atlantic Ocean and gorgeous beaches, this is one of the best things to do in Salema.
And for any nature lovers out there, stop at the Boca do Rio Nature Reserve, a beautiful spot to observe migratory birds and marvel at the wonderful natural beauty of the area.
Best eco-resort in Salema: SALEMA ECO CAMP – SURF & NATURE
Salema Eco Camp is a budget-friendly camping & glamping resort, part of the Natural Park of Costa Vicentina, a coastline with over 100km of protected natural beauty. Here, you will find the perfect camping life mixed with history, adventure and plenty of outdoor activities.
Holden a Certificate of Carbon Neutrality, it is the perfect place to meet other eco-conscious travellers, connect with locals and enjoy a slow living lifestyle. Its commitment to sustainability is reflected in its eco store, organic restaurant and Alma Mater space for wellness activities like yoga.
📍 8650-196 Salema
⭐️ 4.2/5 (Google reviews)
💵 From £100 per night
Portugal travel planning guide
🚑 Should I buy travel insurance to travel to Portugal?
Yes, buying insurance is always valuable when travelling abroad. Enjoy your sunny vacation in the Algarve stress-free with one of my favourite providers, Nomad Insurance.
💧 Can you drink the water in Portugal?
Yes, tap water is safe to drink all over Portugal, including the Algarve. However, I also recommend travelling with the UltraPress Purifier Bottle, a lightweight filtered water bottle perfect for reducing plastic and staying hydrated.
🚗 Is it easy to rent a car in Portugal?
Yes, renting a car in Portugal is easy and is a great way to explore the country freely. I recommend booking yours with Rentalcars.com – they offer a variety of operators for all budgets.
🏨 How to book accommodation in Portugal?
The best way to book your accommodation in Portugal is with Booking.com – my favourite platform to compare and reserve places to stay each night, from affordable hostels to luxury resorts.
✈️ What is the best site to buy a flight to Portugal?
I recommend booking your plane with Skyscanner. It has been my favourite platform for years, as it allows me to book the cheapest flights whilst lowering my carbon emissions.
Where to stay in the Algarve – FAQ
The best area to stay for your first time in the Algarve is in Lagos. This lively town has everything you need, from a beautiful Old Town filled with shops and restaurants to a stunning coastline where you can relax on the beach or enjoy water sports.
The southwest part of the Algarve is the least touristy but the most remote and picturesque! Here, you will find breathtaking untouched landscapes, beaches and towns to explore, including Salema and Sagres.
If nightlife is what you are looking for during your Algarve vacation, then I recommend you stay in Albufeira. The town has become a major tourist destination for young adults, especially with its Strip, a district full of restaurants, bars and clubs.
It is hard to answer, but I would say that Lagos has the best and most beautiful beaches, including Praia de Dona Ana, Praia do Camilo, Praia do Pinhão and Ponta da Piedade. They all offer something different, whether you seek tranquillity or fun beach time.
And you, where is your favourite place to stay in the Algarve, Portugal?
Let me know in the comments below!
With love ♡
Lucie
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