The ultimate guide to Car Rentals in Lagos and the Algarve.

This superlist will help you find a car rental in Lagos no matter your need or budget – from $5 a day steals to luxurious rides you can’t find elsewhere as well as letting you know what to expect when driving in Portugal for the first time. Lets hop right in!

In our humble opinion, a car is necessary for easily exploring Portugal and especially the Algarve. Unfortunately the transit options are quite limited in the Algarve and if you want to venture beyond Lagos then a vehicle is a necessity. Many of the best beaches, landmarks, and remote areas are not accessible by public transport.

I highly recommend searching by way of the, Discover Cars, or Kayak as they’re comparison engines which help you find the lowest rate.

Before you start..

There are a few things to know! Many of the larger companies allow of pickup/drop-off at Faro airport, which is a big convenience factor.

I recommend using one of the following search engines to find the cheapest booking possible. They will compare and even find you special rates on a ride that the official websites won’t show!

The best prices often here
Usually good rates found here

Ensure you read the fine print for the terms & conditions – the deposit and insurance details will be there!

Take photos of the vehicle before and after drop-off to ensure you don’t run into ‘hidden’ charges!!!

Things you should know before renting a car in Portugal

It may be different than in your home country – so here are some frequent topics:

Do you need an international drivers license to rent a car in Portugal?

Portugal generally accepts driving licenses issued by other European Union (EU) member states and European Economic Area (EEA) countries. If you’re from a non-EU or non-EEA country, you may need an International Driving Permit (IDP) in addition to your valid driver’s license.

However, rental policies can vary between car rental companies, so it’s essential to check with the specific rental agency you plan to use. They can provide you with the most accurate and up-to-date information on their requirements.

For myself I’ve rented from numerous rental companies with a Canadian drivers license without any issue at all, though it’s better to be safe and have an IDP (International Driving Permit) sorted out prior to arriving.

Can I drive to Spain with my Portuguese car rental?

En route to Spain via the Portimão suspension bridge

This again depends on the rental company – some permit it by default, some do not permit it at all, and some permit it with the purchase of additional insurance. Ask the company for clarification prior to your booking to avoid any surprises!

How do car insurances and deductibles work in Portugal?

Similar to most other nations in Europe – you have a default level of coverage included with your rental (which varies again from agency to agency). A typical deductible starts at 500-1000 euros and must be charged to a credit card under your name.

However you can purchase insurance packages which generally cost 5-20 euros per day, and each of these tiers will reduce to deductible to a lower amount. This is ideal if you want to pay less of a deposit and have more peace of mind.

Navigating Portugals Road network

Portugals road network can be summed up simply into 3 ‘sections’. The toll-paid highways, non-toll highways/regular causeways, and urban roads.

The A22 is the main toll road connecting Lago to Faro airport

Generally, the toll-paid highway system connects much of Portugal and is a very fast, large, and smooth highway with a speed limit of 110-130km/hr.

For the purposes of the Algarve though this toll highway only covers the route between Lagos to Spain, and the Algarve to Lisbon – the rest of the roads are regular non-paid roads.

Toll roads in Portugal

Toll road prices very from spot to spot

The major highway system in Portugal is a paid toll road with electronic readings all over. To avoid charges showing up in the mail later on, you should opt for an optional ‘Via Verde transponder’ in your car rental.

It should only cost a couple euros per day at most, and all rental companies should be able to provide one. Absolutely worth getting it if you plan to drive to Lisbon or beyond, or frequently between Lagos and Faro.

Each toll checkpoint will automatically beep your transponder – price depending on the size/class of your vehicle. Generally each checkpoint will charge around €1,50 for a regular sized sedan. There are several transponder points between Faro and Lagos.

Vehicles on the toll highway in Portugal often travel far beyond the speed limit – check the section on Cultural Tips for Driving in Portugal!

Non-paid roads in the Algarve

You can still travel between Lagos and Faro on regular roads, though at a slower rate with more turns and lights.

These roads are also of adequate quality in most places and car be treated as normal. They are free of charge and follow simple rules of the road.

For more rural locations and adventurous landmarks you are likely going to end up on non-paved roads. Many of them poorly maintained and rough – be wary when driving to many of the secluded beaches as it may be possible to damage your vehicle on some of these routes!

Cultural tips for Driving in Portugal

Portuguese car driving culture is quite different than that of North America and Central/Western Europe.

Generally, people find Portuguese drivers to drive very quickly, passing aggressively, and not always using turn signals. You will find that some drivers here may treat road regulations more as a suggestion than a strict law.

I have personally witnessed countless times drivers overtaking into the opposite lane on a blind corner – a recipe for disaster.

Lots of blind corners on single lane roads!

I would exercise caution when driving along windy-twisty roads – particularly anywhere between Lagos, Monchique, and Aljezur.

Portugal loves ‘rotundas’ – traffic circles!

It’s very true – you will come across infinite roundabouts, which, is quite refreshing! If unfamiliar with traffic circles then I recommend brushing up on traffic circle etiquette so you don’t end up like the countless tourists in a panic as they approach their first multi-lane roundabout!

If you are on the highway – stay right! Drivers on highways oftentimes go quite beyond the speed limit – keep to the right to let them pass and avoid any dangerous situations. Only go into the left lane when passing.

List of car rental agencies in Lagos

Here you’ll see list of the car rental companies/agencies which have a pickup/drop-off office around Lagos along with a quick description to better understand their service.

Usually good rates found here
Often shows a wider variety


🥳 LuzCar is the winner of our ‘Best Algarve car rentals 2023’ award! 🥳

We’ve had and heard nothing but great things involving their service, customer care, and fleet – their pricing is fair and long-term deals are possible – give them a call to see what is available and for long-term quotes.

Based in Lagos for over 30 years, LuzCar has a large fleet of over 800 vehicles with a stellar local reputation and fair prices. People frequently use LuzCar for long-term rentals and all insurances are included in the prices.

  • Unlimited mileage
  • Insurances included
  • Insurance for Spain included

Website link

Multi Rental

Multi Rental has a selection of cars, vans, mobility vehicles, and trucks available for rent. This is particularly useful if you need a commercial van, box truck, moving truck, or mobility-vehicle. They also carry an array of regular cars in their fleet.

Website link

Marina Rent-A-Car

MarinaRentACar is a smaller family-owned business – which appeals if you’d like to support local business instead of an international conglomerate.

Website link


DailyRent is a smaller car rental service which offers scooters and bicycles for rent on a daily/weekly/monthly basis.

Website link


Sidecar32 is a two-wheel rental service which has a range of modern scooters and motorcycles for daily/weekly/monthly rental.

Website link


Motorent has a wide range of two-wheel machines to rent including bicycles, scooters, motorcycles, trial motorbikes, and choppers.

Website link

Budget & Avis

Budget/Avis is a generic large corporate and have a franchise model. While they have generally low prices, many mediocre reviews indicate their policies may not be optimal.


Europcar, like Budget/Avis, is a generic large corporate with a franchise model. While they have generally low prices, many mediocre reviews indicate their policies may not be optimal.

Faro airport car rentals & transfers

You can rent an array of cars with direct pickup at Faro airport.

The best prices often here
For finding a rental at Faro airport

Taxi and airport transfers

Usually Faro airport transfers and taxi services cost from 60-80 euros, each way! Likewise with Uber, Freenow, or any of the other apps. Taking the bus or train from Faro airport to Lagos will cost aprox. 10-20 euros and have a ~2 hour travel time.

Therefor it’s recommended to book your car rental so you can pick up/drop off in Faro and avoid these prices and added travel times.


Bus from Faro airport to Lagos

The VamusAlgarve website is an invaluable resource for navigating the Algarve by bus.

There are 4 busses which depart from Faro airport – 55 and 118 which go to the Universities, and 56 & 57 which go all the way to Lagos, stopping at Albufeira, Lagoa, and Portimão on the way. These busses take aprox. 2.25 hours from Faro to Lagos.

Ensure you check the Aerobus Faro to Lagos schedule to verify that the lines are running. The bus line 56 is 15e without discount. A 3 day tourist pass is 35e and allows for unlimited bus travel in the Algarve.

Alsa bus lines also run from Lagos to Faro airport directly for around 15 euros.

Train from Faro airport to Lagos

To get to the Faro train station from Faro airport you can take bus 16 for 2.50 euros, alternatively take an Uber or Freenow for around 7 euros to save some time.

To take the train from Faro to Lagos check the Comboios de Portugal website for timetables and prices. The train is aprox. 7.50 euros from Faro to Lagos.

Camper/van rentals in Lagos

If you want to sample the taste of vanlife in the Algarve, renting a van or camper in Lagos is a great idea!

Do pay attention to the legal status of wild camping with a van in the Algarve and to plan your route accordingly.

Check out the Guide to camper van rentals in the Algarve for more information!


Hopefully this guide to all things car rentals in Lagos helped you out! If you have any questions please drop a comment down below and we’ll get back to you ASAP!

We recommend reading our guide to Getting started in Lagos to help you find out the best things to do in Lagos, how to find rent in Lagos, and other crucial information about the town!

  • Large explosions destroy beloved restaurant in Luz

    Large explosions destroy beloved restaurant in Luz

  • Complete guide to bike rentals in Lagos

    Complete guide to bike rentals in Lagos

  • Things to do in Lagos for Christmas (2023)

    Things to do in Lagos for Christmas (2023)

Leave a Comment