After being defeated by Rui Rio in his party's 2020 leadership election, he won against Jorge Moreira da Silva in 2022 and became President of the PSD.

Under Montenegro’s leadership, the PSD reached an agreement with the party CDS-PP and formed the centre-right Democratic Alliance ahead of the 2024 Portuguese legislative election.

[3] He defended the implementation of a strict economic austerity programme negotiated by Portugal in exchange for an international financial bailout.

[8] He left parliament in February 2018 after Passos Coelho's resignation, warning that the PSD should not turn into new leader "Rui Rio's group of friends".

Montenegro was the first person to put himself forward for the party leadership election,[17] in which he ran against former minister Jorge Moreira da Silva.

[18] Under Montenegro’s leadership, the PSD reached an agreement in January 2024 with the CDS-PP for a pre-electoral alliance as they sought to bolster their chances of winning the national elections later that year.

[21] On 21 March 2024, President Marcelo Rebelo de Sousa formally issued Montenegro an invitation to form a government.

[22][23] Montenegro was sworn-in as prime minister of Portugal, heading the XXIV Constitutional Government, on 2 April 2024 at a ceremony in the Ajuda National Palace in Lisbon.

[37][38][39] On 2 December 2024, the Public Prosecution Office announced the closure of the criminal investigation due to finding no evidence of crimes or irregularities.