21 August: the day Funchal became a city

Before the city, a settlement by the sea

To find the beginning, it helps to go back to the earliest years of Madeira's settlement, which started in the 1420s. João Gonçalves Zarco settled in the Funchal area, a naturally sheltered bay surrounded by fertile land, and became the region's first captain-donatary.

The city's own name keeps a memory of that time. It is widely believed to come from the abundance of funcho (fennel), the aromatic plant the first settlers found growing in this part of the island.

The location proved strategic almost immediately. With access to the sea, good farmland and a favourable position on Atlantic trade routes, the small settlement began to grow.

It was a crop brought to the island, though, that accelerated that growth beyond anything the first settlers could have expected.

The sugar that put Funchal on the map

In the second half of the 15th century, sugarcane became one of Madeira's most valuable crops. Sugar was, at the time, rare and expensive across Europe, valuable enough to become known as "white gold". Madeira's production drew merchants, capital and families from across Europe, while Funchal's port established itself as a stop on international trade routes.

As the economy prospered, the settlement itself changed. Merchant houses, religious buildings and new streets appeared. Some of that riverside layout, though it has changed shape many times since, still echoes in the names of streets in the same part of town today, among them Rua de Santa Maria, Rua Direita and Rua do Sabão.

Construction of what would become the cathedral, the Sé, began around 1493 by order of King Manuel I. By the time the king elevated Funchal to a city on 21 August 1508, the Sé was already in use for worship, even though its full completion, including its distinctive ceiling, was still some years away, arriving in 1514.

Only a few years later, in 1514, the Diocese of Funchal was created, its jurisdiction eventually stretching across vast Portuguese overseas territories in Africa, Brazil and the East. The small settlement born by the Atlantic had taken on an importance that reached far beyond the size of the island itself.

1566: when corsairs took Funchal

Prosperity also drew unwanted attention.

In October 1566, Funchal lived through one of the most dramatic episodes in its history. A French corsair expedition, commanded by Pierre Bertrand de Montluc, attacked Madeira and managed to enter the city.

Days of violence, looting and destruction followed. Houses and religious buildings were ransacked and several families lost much of what they owned. Montluc himself died in the fighting, but his men left Madeira with a considerable haul.

The attack exposed the city's vulnerability in the starkest way and forced a lasting change. The following year, King Sebastião sent royal works master Mateus Fernandes to Funchal to draw up a new defensive plan, setting in motion the construction and reinforcement of the city's walls and fortifications.

Some of those structures would go on to shape Funchal's urban landscape for centuries.

From sugar to wine, and from merchants to the first tourists

As sugar production declined, another product gradually took a central place in Madeira's economy: Madeira wine.

Through the 17th and 18th centuries, wine reinforced the trade relationship between the island, Europe and the wider Atlantic world. The port remained one of the city's great gates, in and out. Later, through the 19th century and into the early 20th, Funchal also became a regular stop for ships travelling between Europe, Africa and the Americas.

A new chapter was beginning at the same time. From the 19th century onward, Madeira's mild climate earned a reputation beyond its shores, and the island began to welcome members of the European aristocracy and visitors who stayed for long seasons. It was the start of an activity that would go on to transform the city profoundly: tourism.

A city of illustrious visitors

Across the 19th and 20th centuries, Funchal welcomed a number of figures who today belong to world history.

Empress Elisabeth of Austria, known as Sissi, spent time on Madeira in 1860 and 1861 for her health, one of the European aristocrats associated with long stays on the island. Decades later, another member of the Habsburg family would remain permanently linked to the city: Charles I of Austria, the last Austro-Hungarian emperor.

Exiled to Madeira, Charles arrived in Funchal in November 1921. He eventually settled in Monte, where he died in April 1922. His tomb remains in the Church of Nossa Senhora do Monte.

Not long after, between late 1924 and early 1925, the Irish playwright and future Nobel laureate George Bernard Shaw spent a season on Madeira, staying at Reid's Palace. Among the more curious episodes of that stay were the tango lessons he took in Funchal, moments later captured by local photographers.

And in January 1950, one of the most famous visitors of all arrived: Winston Churchill. Staying at Reid's Palace, he used the visit to rest, write and paint. It was during a trip to Câmara de Lobos that he put the fishing village's colourful bay on canvas.

These are different episodes, but together they point to something that still defines Funchal: its capacity to welcome people from all over the world without losing its island identity.

A city that never stopped changing

Not every chapter of Funchal's history has been calm.

In 1803, a devastating flash flood struck the city, the worst natural disaster recorded on the island, and led to major work on its riverbeds in the years that followed. More than two centuries later, the flood of February 2010 again showed the force of nature and forced the city to rebuild and adapt part of its waterfront once more.

Between those two events, Funchal changed profoundly. New roads and forms of transport arrived, hotels and gardens developed, the port was transformed, the Mercado dos Lavradores farmers' market opened in 1940, and the city kept climbing the slopes that form its distinctive amphitheatre over the Atlantic.

And yet, a short walk through the centre is enough to find traces of the several cities that exist inside today's Funchal.

The Sé still stands at the city's heart. Rua de Santa Maria remains one of its oldest arteries, its historic doors today repainted by local and international artists as part of the Zona Velha's open-air street art project. The old fortifications recall an age when the horizon needed constant watching. Historic quintas tell the story of the first foreign visitors. And the port, which for centuries received merchants and navigators, today receives travellers and cruise ships from all over the world.

Five centuries, one enduring link to the Atlantic

Contemporary Funchal is both historic and cosmopolitan. It is a city of gardens and markets, hotels and museums, old streets and contemporary architecture, a capital that stretches from the waterfront up the surrounding slopes and remains deeply tied to the ocean. Just outside the city, the Laurissilva forest that covers much of the island was inscribed as a UNESCO World Heritage Site in 1999, a reminder that Funchal's history has always been shaped by the landscape around it.

Perhaps it is exactly this overlap of eras that makes Funchal so interesting.

Behind the city visited today stand the first settlers, the sugarcane fields, the merchants who crossed the Atlantic, the corsairs who arrived by sea, the walls built to keep them out, the wine producers, the travellers who came for Madeira's climate, and everyone who, across more than five centuries, made these streets their home, even if only for a while.

Related reading

For more on the traditions that grew alongside Funchal's history, see our guide to the rhythm of Madeira, folklore, dance and tradition. If you are planning your visit around the island's calendar, our guide to Madeira's events and festivals covers the year in full, City Day included. And for the story of what came after sugar, see Madeira wine, the toast that shaped history.