Everywhere in the Algarve you will find good value restaurants. The Algarve is particularly famous for its fresh fish and seafood (which unfortunately is
no longer cheap). Generally eating out is not only a pleasurable experience but also inexpensive. Most resorts boast restaurants serving international cuisine with Indian, Chinese and even Mexican to choose from.
Portuguese food is fresh and wholesome. There are many regional specialities that are derived from local traditions and ingredients.For example some of the dishes to look out for are:

“Caldo Verde”  - potato soup with sausage and shredded cabbage
“Sardinha Assada”- sardines grilled over charcoal
“Caldeirada de Peixe”- fish, shellfish, potatoes, tomatoes and onions stewed together
“Bacalhau”- salted cod steak with onions, potatoes and parsley
“Coelho Assado”- roasted rabbit with onions, white wine and spices
“Frango no Churrasco Piri-Piri”- grilled chicken in a hot spicy sauce
“Saloio e Queijo Fresco”- white and creamy fresh cheese
“Pudim Molotov”- a rich cocktail of meringue and caramel
“Arroz Doce”- rice pudding with cinnamon and cream
“Uma bica”- small black coffee
“Um garoto”- small white coffee

PORTUGUESE WINE AND BEVERAGES:

Perhaps the most famous Portuguese drink is Port. At one time it was drunk almost exclusively in England, but nowadays more than three times as much goes to France as to Britain. The Portuguese have developed a taste for it themselves although they prefer white port rather than sweet red as an aperitif.
By far the most popular drink in Portugal is wine; not satisfied with the three normal shades, the Portuguese added a fourth - green “verde”, which describes its immaturity not its color. The Algarve has a reputation for producing excellent grapes along with good local wines, particularly those from Lagoa and Lagos.
The local liqueurs, “medronho” - made from the arbutus berry and bitter almonds (“amendoa amarga”) are worth trying.

WINES IN PORTUGAL:

Vinho Branco …………………White Wine
Vinho da casa ………………..House wine
Vinho clarete …………………Light red wine
Vinho doce ……………………Sweet wine
Vinho espumante ……………Sparkling wine
Vinho do Porto ……………….Port wine
Vinho da regiao ……………..Local wine
Vinho seco …………………….Dry wine
Vinho verde …………………..“Green” wine (semi-sparkling acidic wine)