Some Algarve holidays need a car; most do not. The answer falls out of three questions: where you sleep, whether your must-see list includes inland or west-coast spots, and how you feel about narrow village streets.
You likely DON'T need one if…
You base yourself in Lagos, Faro or Tavira, plan beach-and-town days, and are happy reaching grottos by boat and islands by ferry. Trains stitch those towns together, and everything on your evening shortlist will be walkable.
You probably DO if…
You are chasing west-coast surf beaches, Monchique's mountain roads, scattered vineyard lunches, or the finest hidden coves at their quietest hours. Rural stays — quintas, hillside villas — also argue strongly for wheels.
The hybrid solution
Many regulars combine strategies: trains between bases, a hire car for two or three inland days, ride apps for evenings. Renting for just the middle of your trip often beats a full-week rate on convenience alone.
Parking reality check
Old-town streets in Lagos, Faro and Tavira were laid out for carts. Summer parking gravitates to signed lots at the edge of centres — cheap or free, and always closer than driving in circles for a door-step spot.
