Fuseta was first mentioned during the Portuguese Age of Discovery, when many of the villages fishermen shipped aboard the caravels to the spice routes and expeditions in the Far East.

Gaspar Corte-Real, a nobleman and resident of this area, claimed to have discovered the land now known as Newfoundland in 1500, beginning many of the Portuguese ventures onto the Grand Banks in search of cod.

As the population grew, the Bishop of the Algarve, D. Francisco Gomes de Avelar, was petitioned to grant the ecumenical independence of the parish, which had previously been included in Moncarapacho.

In 1835, the parish was exempted from paying fees to the Diocese by the Governor of the Bishop, Dr. António de Santo Ilídio da Fonseca e Silva.

With an area of 0.36 square kilometres (0.14 sq mi), Fuseta is located along the Algarvean coast, bounded on the north and west by the parish of Moncarapacho, to the south by the Ria Formosa and along the east by the municipality of Tavira.