Prostitution in Portugal is not illegal, but organized prostitution (brothels, prostitution rings or other forms of pimping) is prohibited.

Several other prostitution-related activities are also widely disapproved and outlawed, such as human trafficking, child prostitution). By the mid-2000s, the number of female prostitutes was estimated at 28,000, at least 50% were foreigners.

Prostitution become much more visible since the early 1990s with a migratory wave from Brazil and Eastern European countries. Prostitution services' contacts are easily found in many magazines, newspapers and websites. Press sources suggest that half of the women engaged in prostitution in Portugal are foreigners, especially from Brazil and Eastern Europe (Ukraine, Russia, Romania, Moldova and Bulgaria), but also from Africa and some Asian countries. Human trafficking, including trafficking of underage persons, has also become a growing issue for the authorities. Under the Portuguese penal code, trafficking in women is a crime punishable by two to eight years' imprisonment.

In Portugal, prostitution occurs in various different settings. Expensive specially attractive and young prostitutes that advertise on the web and in the news stands can be easily found in the major cities and most crowded tourist resorts. Prostitution can also take place in the prostitute's apartment which may be located anywhere, from the suburban areas to expensive flats in the main town centers. In street prostitution the prostitute solicits customers while waiting at street corners or walking alongside a street. Prostitution occurs in some massage parlors, bars and pubs. There are "unofficial" brothels which are establishments specifically dedicated to prostitution, but disguised as discos, hostels or restaurants. There is a form of prostitution often sheltered under the umbrella of escort agencies, who supply attractive escorts for social occasions - these escorts provide additional sexual services for the clients.

Both heterosexual and homosexual male prostitution also occurs in various different settings, ranging from gay bars to discos and beach resorts. A large share of the males engaged in prostitution in Portugal are also foreigners, especially from Brazil and Africa. The concept of gigolo is used and is usually linked to male prostitutes with an exclusively female clientele. Most big cities have an area where homossexual male prostitutes regularly make themselves available to male potential clients cruising by in cars (for example, Lisbon's Eduardo VII Park reached notability for male prostitution, sometimes underage, as well as the Monsanto Park, usually by nighttime).

Transsexual and transgender prostitution also exists, particularly of Brazilian transvestites, namely at street level in certain designated areas (for example the Conde Redondo area in Lisbon), but also through web venues.

One of the main increasing venues for prostitution in Portugal is the internet.

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