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A Little Bit About Ferragudo, Lagoa, Portugal Ferragudo is situated about 50 Km West of Faro on Portugal's Algarve coast. It is a pretty village and unspoilt. Although every year becoming more popular for holiday makers, Ferragudo continues to retain its Portuguese identity with being a working fishing village. You wont find back to back bars with sports TV and loud music but you will find everything you need including plenty of restaurants and bars where you are able to relax and enjoy the Algarvian way of life. Ferragudo sits at the mouth of the Arade river that is protected by the Sao Joao do Arade castle and has beaches sheltered by the breakwater but the open sea is also nearby.