The Phoenicians of the Levant, Greeks of Europe, and Carthaginians of Africa all colonized parts of Iberia to facilitate trade. In the 10th century BCE, the first contacts between Phoenicians and Iberia (along the Mediterranean coast) were made. This century also saw the emergence of towns and cities in the southern littoral areas of eastern Iberia.

The Phoenicians founded colony of Gadir (now Cádiz) near Tartessos. The foundation of Cádiz, the oldest continuously inhabited city in western Europe, is traditionally dated to 1104 BCE, though, as of 2004, no archaeological discoveries date back further than the 9th century BCE. The Phoenicians continued to use Cádiz as a trading post for several centuries leaving a variety of artifacts, most notably a pair of sarcophaguses from around the 4th or 3rd century BCE. Contrary to myth, there is no record of Phoenician colonies west of Algarve (namely Tavira), though there might have been some voyages of discovery. Phoenician influence in what is now Portugal was essentially through cultural and commercial exchange with Tartessos.

In the 9th century BCE, the Phoenicians, from the city-state of Tyre founded the colony of Malaka (now Málaga) and Carthage (in North Africa). During this century, Phoenicians also had great influence on Iberia with the introduction the use of Iron, of the Potter's wheel, the production of olive oil and wine. They were also responsible for the first forms of Iberian writing, had great religious influence and accelerated urban development. However, there is no real evidence to support the myth of a Phoenician foundation of the city of Lisbon as far back as 1300 BCE, under the name Alis Ubbo ("Safe Harbour"), even if in this period there are organized settlements in Olissipona (modern Lisbon, in Portuguese Estremadura) with Mediterranean influences.

There was strong Phoenician influence and settlement in the city of Balsa (modern Tavira, Algarve), in the 8th century BCE. Phoenician-influenced Tavira was destroyed by violence in the 6th century BCE. With the decadence of Phoenician colonization of the Mediterranean coast of Iberia in the 6th century BCE many of the colonies are deserted. The 6th century BCE also saw the rise of the colonial might of Carthage, which slowly replaced the Phoenicians in their former areas of dominion.