The Portuguese Civil Protection Agency said firefighters had contained 95 percent of the blaze in rolling hills by the country's southern Algarve coast, though they were wary of reignitions and changes in the wind.
The news brought relief for locals and tourists who spent tense hours after dark Sunday as the huge blaze passed by the outskirts of Monchique, a town of 2,000 people 250 kilometers (155 miles) south of Lisbon.
High plumes of black smoke from the wildfire could be seen from the famous beaches of Portugal's Algarve region.
As the smoke gradually cleared Monday, 13 aircraft swung into action, including two large Canadair water-dropping planes sent by Spain. More than 1,100 firefighters were deployed to fight the blaze.
Authorities said 44 people required medical assistance, including a 72-year-old woman who was seriously hurt.
The blaze erupted amid a heatwave caused by a mass of hot air from North Africa that sent temperatures in Portugal and Spain over 45 degrees Celsius (113 Fahrenheit) over the weekend.
The rest of Europe has also felt the torrid recent weather.
In France, where four nuclear reactors have been temporarily closed due to the heat, three cities banned the most polluting cars from the roads because of heat-linked ozone pollution. In Paris and Strasbourg, the ban concerned vehicles that are 12 years and older, while in Lyon only cars with a clean air sticker were allowed.
The heat wave in France was expected to last until Thursday, with temperatures peaking Tuesday.
In Germany, the grape harvest started on its earliest date yet amid an exceptionally hot summer. The first grapes are used to make Federweisser, a young wine that gives the first hints about the year's potential quality. The main harvest is expected to start in late August or early September.
In Norway, authorities warned motorists to watch out for reindeer and sheep taking shelter from the heat in highway tunnels. The country has an estimated 220,000 reindeer and more than 800,000 sheep.
Neighboring Sweden has been fighting an uncommon number of wildfires this summer, even above the Arctic Circle, and a European Union official pointed his finger at climate change.
"We are facing a new reality," EU Humanitarian Aid Commissioner Christos Stylianides said. As a result, the EU must become "collectively better prepared and stronger in responding to multiple disasters across the continent."
Over the weekend, Lisbon broke a 37-year-old record to notch its hottest temperature ever and new heat records were set in 26 places around Portugal.
That extreme heat was easing a bit Monday but parts of south and northeast Portugal remained at "extreme risk" of wildfires, according to the national weather agency.
AP correspondents across Europe contributed to this report.
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