Many people have asked about the international use of the iPhone and i don't think anyone has responded with what AT&T had told them when they call.
The phone should work just fine in portugal as long as you call AT&T And have them activate the international roaming on the phone. This is a security feature of AT&T and their phones. As for the internet i am not sure the cost, thereforee you should just ask them if or when you activate your roaming.
Others have suggested just getting a sim card when you are there to avoid the high expense of the roaming charges. I would google prices in Portugal for sim cards and compare that to AT&T's prices.
Have fun in Portugal what ever you do. Take some pictures with the iPhone so we can all see.
