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  >  Travel Guides   >  Where To Stay in Algarve, Portugal – 7 Best Towns and Hotels
Melissa showing us where to stay in Algarve
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The Algarve is a stunning coastal holiday destination in Portugal, home to incredible beaches and beautiful resorts. In case you’re wondering where to stay in Algarve in order to soak in everything in this golden coastline region, I’m here to help! Scroll down to find my personalised recommendations for the best towns and resorts in Algarve, grouped by type of traveller. You’ll find everything here from luxurious resorts to self-catered apartments – and everything in-between!

The Algarve is one of the most popular destinations in Europe for travellers that want to sip a cocktail on the beach, relax in world-class resorts or keep active with some water sports, hiking or even… golf! 

Choosing the ideal area to stay in Algarve during your holiday can be a really challenging task. There are so many towns to choose from, each offering different perks and advantages.

From resort towns to fishing villages, this article is here to answer all your questions regarding the BEST place to stay in the Algarve for you!

Algarve - Best places to stay by type of traveller

I know it can be hard to choose, so I broke down the most popular areas in Algarve in the list below, so you can find the ideal spot depending on your preferences and budget:

  • Where to stay in Algarve for luxury – Vilamoura or Almancil
  • Where to stay in Algarve for couples – Albufeira
  • Best places to stay in Algarve for nightlife – Portimao or Albufeira
  • Where to stay in Algarve for families – Sagres
  • Where to stay in Algarve without a car – Lagos
  • Best place to stay for culture – Faro

Before diving right into it, here’s an Algarve map (including Faro Airport) so you can clearly see where all these areas are located:

Map of the algarve with 7 towns in algarve marked on the map
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1 - Albufeira

Albufeira Beach in Algarve Portugal
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Albufeira is a former fishing village, nowadays probably the most popular tourist town in the Algarve! Albufeira gets especially busy in the summer months and at Christmas and New Year. One look and it’s easy to see why. The town is located 40 minutes away from Faro Airport by car. With plenty of serene, long beaches, lively bars and restaurants, golf courses and tons of day trip opportunities (diving, cave tours, dolphin watching), Albufeira is one of the best towns in the Algarve when it comes to entertainment.  

While you’re here, you can also experience the cobbled streets of the historical centre (the Old Town), which has previously been inhabited by the Romans and the Arabs, for a dose of Portuguese culture and history. There are also tons of great restaurants and bars around, as well as a vibrant nightlife scene!

Where to stay in Albufeira

MY TOP PICK: EPIC SANA Algarve Hotel – This is the perfect place for an epic getaway! This gorgeous 5-star hotel boasts not just one swimming pool, but five! It pretty much overlooking Falésia Beach and it’s not far from the Old Town either, which is a nice plus. Also, they have some family-friendly rooms as well for those travelling with the little ones!

EPIC SANA Algarve Hotel in Albufeira, Algarve
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Here are some other excellent hotels in Albufeira:

LUXURY. Sao Rafael Atlantico

MID-RANGE. Velamar Boutique Hotel

BUDGET GUEST HOUSE. Peneco Albufeira GuestHouse

HOSTEL. Orange Terrace Hostel

ENTIRE APARTMENT. 3HB Golden Beach

2 - Lagos

Melissa and Guga in Lagos Algarve
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RELATED READ: 11 Best Things To Do in Lagos, Portugal

Looking for an awesome place to stay in the Algarve? Even if you don’t have a car? Lagos is your answer! Lagos is a lively town situated in the heart of the Algarve region. The town is famous for its tourist-friendly, sandy beach options, stunning rock formations (Ponta da Piedade is a personal fav), great restaurants, bars and a vibrant summer nightlife with plenty of parties. Some even say that, wait for it… Lagos has the best beaches in Algarve! Just to note a few – Praia da Marinha, Praia do Camilo and Praia Dona Ana.

Lagos really caters for any type of traveller, whether you’re there for the party atmosphere or you’re looking for a family holiday filled with lazy beach days. There is definitely something there for everyone to enjoy. I would even go as far as to say that Lagos is my personal favourite Algarve town to stay in… it’s just got a great vibe and a little bit of everything!

TIP: Lagos is not that big, so almost every accommodation here is located within walking distance to a beach, only a few minutes away – an excellent advantage!

Where to stay in Lagos

MY TOP PICK: Cascade Wellness Resort – Do you want to relax in a superb room that overlooks the Atlantic Ocean? This place is for you! Except for the picture-perfect sea views, this luxury resort awaits with an outdoor pool, an excellent location 30-minute away from Dona Ana Beach and Ponta da Piedade Lighthouse, proximity to a golf course and 3 on-site restaurants. Talkin’ about splurging, right?

Cascade Wellness Resort in Lagos Algarve
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Other than this one, here’s my list of great hotels in Lagos:

LUXURY. Marina Club Lagos Resort

MID-RANGE. Hotel Marina Rio

BUDGET HOTEL. Hotel Lagosmar

HOSTEL. Olive Hostel Lagos

ENTIRE APARTMENT. Boavista Golf & Spa – Bela Colina Village

3 - Faro

Porto de Faro in Portugal
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Because Faro is Algarve’s capital and the town where the airport is located as well, it will probably be the destination that you’ll be flying into to start your trip. A lot of tourists don’t take the time to explore the area of Faro, opting to head straight to the popular destinations of Albufeira or Lagos. If you do decide to stick around (which I highly recommend!), you’ll find a world of culture and historical sites. 

You can visit the Medieval Faro Cathedral, Faro City Hall and Estoi Palace amongst other attractions to get a better understanding of the foundations of the town. Or simply head to the golden sand beaches around Faro to get straight into those vacay vibes!

Where to stay in Faro

MY TOP PICK: Eva Senses Hotel – This centrally located hotel has a rooftop swimming pool, beautifully designed rooms and it’s an overall great place to stay, at least for one night if you want to quickly explore Faro, the capital! Let’s not forget about the on-site “Day Spa” and the panoramic restaurant for those who want to grab a bite with a view!

AP Eva Senses Hotel in Faro Portugal
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Other excellent choices:

LUXURY. Hotel Faro & Beach Club

MID-RANGE. Aqua Ria Boutique Hotel

BUDGET GUEST HOUSE. À da Avó – The Guesthouse

HOSTEL. Casa D’Alagoa

ENTIRE APARTMENT. Faro Downtown Studios

4 - Sagres

Landscape of Sagres Hills in Algarve Portugal
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Sagres is a little surfer town situated in the extreme South-West coast of the Algarve. Sagres is associated with its nautical history and tends to be a big hit with history fans. What you’ll get here? Laid-back vibes, cool cafes and Atlantic waves. One of the highlights of this town is Torre de Aspa – a viewpoint that stands at 157 metres high with a great panoramic view of Sagres and Sao Vicente Cape. 

By the way, Sagres is also one of the best places to stay for visiting surfers and for those looking for the ‘wild’ side of Algarve. And, as I mentioned in the beginning of the article as well, it’s also a family-friendly town.

Where to stay in Sagres

MY TOP PICK: Martinhal Sagres – If you’re looking for the best hotel in the entire Algarve region… you’ve just hit the jackpot, my friend. This luxurious resort is the best place to stay in Algarve if you’re looking for a lavish experience thanks to its 3 outdoor pool options, boutique rooms and numerous outdoor activities. Overall, this is one of the most beautiful hotels in Sagres!

Martinhal Beach Family Resort in Sagres Portugal
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Other excellent choices:

LUXURY. Memmo Baleeira

MID-RANGE. Mareta Beach – Boutique Bed & Breakfast

BUDGET GUEST HOUSE. Local Guesthouse

HOSTEL. Sagres Sun Stay – Surf Camp & Hostel

ENTIRE APARTMENT. Sagres Time Apartamentos

5 - Portimao

Portimao Port in Algarve Portugal
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Portimão is one of the bigger towns based in the Faro district. It has stunning beaches with clear waters and plenty of history behind it. It was traditionally a centre for fish processing, shipbuilding and a sardine fishing port, but this has now been replaced by leisure, retail and exciting tourism. As a traveller, you may have heard about Portimao as the place where the famous Praia da Rocha is located – among the best beaches in Algarve with incredible limestone rock formations.

Here you will find a low-key relaxed ambience, nice shopping areas and lots of cafes and restaurants where you can indulge in some yummy dishes or people watch. No matter whether you are there to relax or explore, there is something to be found for all kinds of travellers!

Where to stay in Portimao

MY TOP PICK: Bela Vista Hotel & Spa – Relais & Chateaux – You know how much I love 5-star hotels – and the Algarve surely doesn’t disappoint with it’s option! You will be spoiled with choice if you choose to stay at this upscale hotel located on the cliffs of Praia da Rocha. Access to a private beach area included!

Bela Vista Hotel and Spa Relais Chateaux in Portimao
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Other great choices:

LUXURY. Hotel Oriental

MID-RANGE. Morgado Golf & Country Club

BUDGET GUEST HOUSE. Happy Moments Guest House

HOSTEL. Alameda Hostel

ENTIRE APARTMENT. Jardim do Vau

6 - Vilamoura

Vilamoura Port in Algarve Portugal
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Vilamoura is one of the most upscale towns around. It was actually built for golf’s ‘high society’ and it’s now the place where you can find some of the best places to stay in the Algarve for a luxurious, first-class experience – plus some peace and quiet. 

Except for incredible, upscale resorts, you’ll also find plenty of world-class restaurants and cocktail bars around, as well as some beautiful beaches such as Praia de Vilamoura and Praia da Falésia, both located within walking distance from the city centre.

Where to stay in Vilamoura

MY TOP PICK: Crowne Plaza Vilamoura – Tastefully designed rooms, a very convenient location only a short walk away from the centre and the Marina and two swimming pools – this is what you’ll get if you choose to book this hotel for your Algarve holiday! Pssst, I’ve heard this place is especially good for couples.

Crowne Plaza in Vilamoura
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Other amazing choices:

LUXURY. The Lake Resort

MID-RANGE. Hotel Parque das Laranjeiras

BUDGET ACCOMMODATION. Casa do Alto

ENTIRE APARTMENT. The Residences at Victoria by Tivoli

7 - Almancil

Landscape of Almancil in Algarve Portugal
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Located on the Eastern coast of Algarve, Almancil is another great place to stay in Algarve if you’re looking for upscale accommodation and exclusive resorts. One of the advantages of this town is that it’s located very close to Faro Airport – only 15 minutes away by car.

Ria Formosa Natural Park surrounds Almancil, making it a great base if you want to spend time in nature or take advantage of the bird watching opportunities. As a downside, Almancil doesn’t offer any of the famous, dramatic cliffs that are pretty specific to Algarve’s landscape but you can expect to find plenty of pristine beaches to explore and enjoy as they were your own.

As for accommodation, the best areas to stay in Almancil are either Quinta do Lago or Vale do Lobo.

Where to stay in Almancil

MY TOP PICK: Conrad Algarve – One of the best hotels in Algarve? Most likely, yes. This is a 5-star resort offering 3 swimming pool options, 3 restaurant options to indulge in some delicious food and 3 bar options if you fancy a tipple. If this isn’t an amazing place to stay, I don’t know what is. Plus, you won’t be far from Ria Formosa Natural Park either!

Conrad Algarve hotel in Almancil Portugal
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BONUS: Other excellent towns to stay in the Algarve, Portugal

Melissa in Praia do Camilo Lagos Algarve
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Above you’ll find the 7 best places to stay in Algarve (in my opinion, at least!), but of course there’s more to Portugal’s southernmost region than this. Below you’ll find my extended list of beautiful towns, in case you didn’t find what you need in my top choices:

  • Praia da Luz – a small holiday resort town, with all the main attractions located within walking distance. It’s also a very good spot for a family vacation as well, with plenty of good hotel options to choose from;
  • Monte Gordo – a nice, laid-back town on the eastern Algarve coast where you’ll find a strong local fishing community, a huge beach and many budget-friendly hotel options and guest houses;
  • Tavira – a great little place full of culture and history, close to Ilha de Tavira, a place full of pristine beaches;
  • Carvoeiro – pick this place if you’re into hiking and gorgeous sea views, as this place is located on a golden cliff, close to the beach. You will find many family-friendly resorts here, as well as good restaurants;
  • Quarteira – once a small fishing town, Quarteira is now the place to go for a holiday full of shopping, Portuguese markets and long walks on the pretty seaside promenade. You’ll also find fun festivals and plenty of nightlife spots here;
  • Olhao – if luxury resorts are not your cup of tea, then Olhão is the place for you if you want to experience how locals live in Algarve, especially when it comes to authentic fish markets. This is where you’ll get to see the real Portuguese charm!
  • Castro Marim – another traditional part of Algarve, Castro Marim is where you’ll get to visit a medieval castle or take on a spa experience!
  • Alvor – choose this town if you’re looking for a calm, laid-back getaway, far from the hustle and bustle of more popular spots in Algarve (Lagos or Albufeira, for example);
  • Aljezur – another amazing surf destination, pretty unknown to the hordes of tourists, with numerous whitewashed houses and charming streets.

RELATED READ: 10 Best Beaches in Lagos, Portugal

This was my complete guide to the best hotels and towns for an excellent stay in the Algarve, Portugal! I’ve compiled the best areas in this beautiful coastal region, all broken down by type of traveller, together with my hand-picked accommodation recommendations, broken down as well, this time according to budget! If you won’t find what you’re looking for here… well, that’s pretty much impossible!

I’m sure you’ll have an excellent holiday along the coast of Algarve, regardless if you’re choosing to sunbathe on sandy beaches, visit some theme parks, play some golf, ride the waves or simply waste some time in the numerous restaurants and cafes. 

And if you’re curious to read more about other exciting destinations in Portugal, I advise you click here to find all the places I’ve discovered during my travels!

xoxo, 

Melissa

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    Melissa showing us where to stay in Algarve
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    I’m a travel enthusiast, content creator and sun seeker extraordinaire! I love a good matcha latte, am obsessed with hats and like to give human names to the stray animals that I befriend on my travels ( I’m talking about you, Lesley!) In 2018 I took the leap and switched my London lifestyle for continuous adventures abroad.

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