12 Best Restaurants in Madeira, Portugal

This excellent coffee shop has a few branches across Funchal, but the best has to be the one on Rua da Conceição, where chairs spill out onto an unnamed square that's cobbled in black and white stripes. Small tables under shady parasols provide the perfect rest stop to grab a bica (espresso) and a pastel de nata (custard tart); step inside and you'll see row upon row of neatly presented cakes and tarts laid out in the chilled counters like gems in a jewelry box.

Seated on the 16th floor of the Savoy Palace, in a cozy room with painted ceilings, you’ll feel like you’re dining under the stars—and the food will truly transport you to another world. Chef Carlos Gonçalves serves up innovative five- to seven-course tasting menus (à la carte is also available) using local ingredients but with a twist—think traditional cozido panelo (vegetables and sausage) transformed into tasty tacos and creamy rice with nori seaweed and lemon purée.

It's best to make reservations or arrive early to bag an outdoor table at this cozy, traditional restaurant in the heart of the old town, where they start you off with a complimentary shot of Madeira. The family-run restaurant offers simple yet delicious local food such as expertly grilled limpets, top-quality steaks, and some of the best grilled fish in town.

From the road, this restaurant doesn't look like much: a fading yellow building with a few signs outside to attract the tourists; step inside and you'll be blown away by the views of the valley from the balcony in the rear. There's a huge wood oven where they grill whole chickens, serving the tender meat with generous bowls of bolo do caco.

From the sandy shores of Praia da Fontinha, climb the stairs to reach this somewhat hidden spot. Sit outside on the rustic deck shaded by palm trees or dine in the surprisingly modern indoor space and watch the staff grill your food in the open kitchen—and come hungry: Pé na Água specializes in huge pots of seafood big enough to feed a whole family.

Set inside a former salt warehouse, this fashionable restaurant with bare brick walls and a few outdoor tables serves immaculately presented contemporary renderings of Madeiran and Portuguese dishes like black scabbard fish with lime risotto and vegetables from the garden. À la carte lunch and dinner menus are a good deal.

This restaurant—wedged into a restored house in the hotel zone around the corner from the Cliff Bay Resort—has lavish tile work, hand-painted murals, and a bar that resembles one of Santana's thatch-roof dwellings. The menu is heavy on fresh seafood (trussed lobsters float in a tank by the door) and regional dishes (including espada served many ways, such as with tropical fruit or shrimp), as well as tornedo (meat on a skewer), the house specialty—and, if you're tired of Madeiran food, pizzas.

Traditional Portuguese cooking seems right at home amid the farmhouse decor at this casual spot on a narrow lane near The Vine Hotel. The dining room fills up with business executives enjoying a relaxing lunch and a mix of celebrating visitors and locals at dinner.

This storefront eatery is far from fancy—from the outside you might mistake it for a takeout joint—but the wooden benches just inside the door are always crowded because of its excellent oven-roasted chicken, served with salad and fries. It also serves home-baked bread.

The inexpensive lunch specials at this streamlined dining room, just behind the municipal gardens, are popular with Funchal's businesspeople. Big portions of simple Madeiran cooking, such as espada, tuna, and grilled pork chops, are served with milho frito (corn fritters filled with garlicky collard greens); for something lighter, try the sopa de tomate e cebola com ovo (tomato and onion soup, garnished with a poached egg).

If you've just visited the Piscifactoría de Ribeiro Frio, this family-owned eatery serves several dishes made with the trout from the local fish farm; the rustic wooden dining room is warmed by a couple of fireplaces. Finish your meal with coffee or tea served with Madeiran honey cake.

At this formal restaurant in the lovely Quinta da Casa Branca, you can sit beneath ornate chandeliers in the elegant restaurant or dine outside on the beautiful terrace. The menu is not extensive, but dishes such as herb-crusted lamb with chestnuts and eucalyptus are prepared with care using fresh local ingredients; opt for three- or four-course menus with wine pairings, or order à la carte.