Vila Real de Santo Antonio lies on the banks of the River Guadiana, which is the natural frontier between Portugal and Spain. A ferry from Vila Real de Santo Antonio takes you across the river to the Spanish town of Ayamonte in Andalusia.

In the 16th century a town called Vila Real de Santo Antonio de Arenilha stood near the site of the present city, though more probably nearer the sea. By the 18th Century it had disappeared, swallowed up by the waves and shifting sands. After the town disappeared there was still a need to control the arrival of merchandise via the Guadiana and to present a firm face to Spain with whom a war had been fought in 1762/1763.

The city was founded by Royal Charter in 1773 and represents the town planning ideals of the Marques de Pombal ( 1699 - 1782 ). He was Portugal’s chief minister under King Jose 1 ( 1714 - 1777 ).

The city was planned to represent the rational ideals of the Enlightenment. Vila Real de Santo Antonio was built in five months using experience that had been gained in building Lisbon after the earthquake of 1755. The legacy of Marques de Pombal is evident in the strict grid of streets that lead off from the broad open square, Praca Marques de Pombal. In the centre of the square is an obelisk monument to King Jose 1. The obelisk acts like the needle of a giant sundial, casting its shadow on the traditional black and white mosaic paving.