Cavaco Silva served as Prime Minister for ten years, instituting major economic liberalisation and winning two landslide victories.

The Povo Livre publication was founded, its first issue being published on 13 July 1974, led by its first two directors, Manuel Alegria and Rui Machete.

The PPD's first major meeting was held in the Pavilhão dos Desportos, Lisbon, on 25 October, and a month later the party's first official congress took place.

[15] Alberto João Jardim was the co-founder of the Madeiran branch of the PSD, and governed the autonomous archipelago for decades, running as a member of the party.

The AD increased its parliamentary majority in new elections called for 1980, but was devastated by the death of Sá Caneiro in an air crash on 4 December 1980.

The early 1990s recession hit Portugal in 1993 and high levels of unemployment adding to this fiscal adjustments, eroded the popularity of the Cavaco Silva's government.

The anti-tolls riots in 25 de Abril Bridge in June 1994 and the violent response from security forces, further undermined Cavaco Silva's position.

[18] Rebelo de Sousa resigned in April 1999 and shortly after, José Manuel Durão Barroso was elected party leader.

The party made a big comeback in the 2001 local elections by winning several cities, like Lisbon, Porto and Sintra, from the PS and, some, against all odds and predictions.

Despite falling short of a majority, it won enough seats to form a coalition with the CDS-PP and its leader, José Manuel Durão Barroso, became Prime Minister.

[21] In the 2004 European Parliament election, the PSD formed an electoral coalition with CDS-PP, the first since 1980, but was soundly defeated by the PS by 45 to 33 percent margin.

This resulted in a non-absolute majority for the PSD, leading to a coalition government with the CDS-PP, which served a full term until the 2015 general election.

During this term, many austerity policies were put into practice to reduce the budget deficit but, ultimately, created unemployment and a recession that lasted until mid 2013.

In the 2015 general election, the PSD and CDS-PP ran in a joint coalition, called Portugal Ahead, led by Pedro Passos Coelho and Paulo Portas.

The PSD/CDS-PP coalition was asked by the then President of the Republic, Aníbal Cavaco Silva, to form a government with Passos Coelho as Prime Minister.

After that, the PSD returned to the opposition benches, and the Socialist Party was able to form an agreement with BE and CDU to support a PS minority government led by António Costa.

Pedro Passos Coelho continued as party leader, but a weak opposition strategy led to bad polling numbers for the PSD.

In the Azores 2020 regional elections, the PSD was able to return to power, after 24 years in opposition, by forging a controversial deal with CHEGA, plus CDS, PPM and IL.

The main gain of the PSD was the victory in Lisbon, where Carlos Moedas defeated, against all odds and predictions, the PS incumbent mayor Fernando Medina.

[34] Following António Costa's resignation due to an investigation around alleged corruption involving the award of contracts for lithium and hydrogen businesses,[35] a snap election was called for 10 March 2024.

Among its representatives were most of the leaders between Francisco Sá Carneiro and Cavaco Silva, Alberto João Jardim (also a founding member and an anti-neoliberal) and to an extent Luís Filipe Menezes (who called the PSD the "moderate left party")[46] identified himself with a centre-left matrix and a united left strategy and defended a more open party on issues like abortion.

When Sousa Franco and his SPD-inspired social democrats started their break with the rest of the party he referred to a division between "a rural wing, led by Sá Carneiro, and an urban wing, more moderate and truly social democratic, close to the positions of Helmut Schmidt"[54] Due to the electoral influence of ruralism on the PSD's politics they may be seen inside of or influencing most factions.

Alberto João Jardim described the inconsistent neoliberalism of the PSD as "those Chicago Boys have some funny ideas, but when election time arrives the old Keynesianism is still what counts".

[76] The main pure representative of the streak is Manuela Ferreira Leite, but even she called herself a social democrat and explained "I'm not certainly liberal, I'm also not populist"[77] and lead the social democratic factions during internal party rifts, though she accepts the nickname "Portuguese iron lady" and comparisons to Thatcher if "[it] means [...] an enormous intransigence on values and in principles, of not abdicating from these values and from these principles and of continuing my way independently of the popularity of my actions and the effects on my image".

Cavaco himself, though a self-described Neo-Keynesian, an early member of the party since its centre-left days and a man with social-liberal and centrist populist economic policy tendencies, he is personally a social conservative (opposing same-sex marriage[79] and abortion) and a practicing Catholic.

[81] A similar case is Vasco Graça Moura, who claims to be an economic social democrat but opposes gay people serving in the military and is a self-described "centre-left reactionary".

Are pragmatic although open to privatization and civil society alternatives to the social state, in speech they move closer to the centre-left origins of the party and are generally proud of them.

Centrists and transversalists inside the party share the think tank Construir Ideias (Building Ideas), which Passos Coelho founded and leads.

[78] They mix (like the closely allied centrists) calls to privatization with others to more social justice, government regulation and arbitration and strategic governmental involvement in the economy.

In the PSD logo, the three arrows represent freedom, equality and solidarity - a traditional social democratic motto, with its roots in the French Revolution.