I have stayed in Faro a couple of times now and you should check this beautiful part of the coast out. I have been there during peak tourist season and it can get bit much with all the people but there is enough beach for everyone. I will be back to check it out again.
Take a long walk along the sandy beach to the monument at the end marking the southern most tip of Ilha Deserta, also the southern most place in Portugal. Once you are on the island, you might as well take a look.