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Olhao is a working fishing town, there is no beach but there is a harbour and you are able to get little taxi boats to local beaches.
All along the harbour are restaurants, and every one we tried was fantastic, the food was plentiful and the fresh fish was amazing. We managed to try a number of restaurants with local dishes and were never disappointed.
There is a large market hall on the harbour selling fresh fish and food and a weekly market selling traditional goods, souvenirs and even chickens!
There is a taxi boat that can take you to unspoilt beaches, it does not have a beach itself but the town is based on the Ria Formosa lagoon system.
Olhao is perfect for sitting and watching the world go by, whilst enjoying good food.