It was revealed at 5pm on Friday the European nation was one of just 12 destinations that travellers will be able to visit from May 17 without having to self-isolate on return to England.
David Child, head of PR and brand at Thomas Cook, said bookings for Portugal went "through the roof" immediately after the announcement.
"We took in the first hour from 5pm to 6pm as many Portugal bookings as we took in the whole month of April," he said.
"Yes, it’s a surge absolutely, but the market is still down on where it would normally be this time in the year," he said.
However, industry bosses have lashed out at the government's approach to unlocking international travel, urging further clarity on when other holiday destinations could be added to the quarantine-free green list.
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Green: There is no need to self-isolate. Take a pre-departure test and a PCR test on day two of your arrival in the UK.
Amber: Self-isolate for 10 days, unless you receive a negative result from a test taken at least five days after arrival. Take a pre-departure test, and PCR tests on day two and day eight of your arrival in the UK.
Red: Spend 10 days in a quarantine hotel. Take a pre-departure test, and PCR tests on day two and day eight of your arrival in the UK.
Iceland, Portugal, Gibraltar and Israel are among just 12 destinations which will be on the green list from May 17 – with some countries on the list still not accepting holidaymakers.
People returning to England from a green destination from May 17 will not be required to self-isolate and are only required to take one post-arrival coronavirus test.
EasyJet boss Johan Lundgren said: "The decision to put so few European countries into the green tier is simply not justified by the data or the science and is inconsistent with the approach to reopen the domestic economy.”
He added: "So, we call on Government to provide transparency on decision-making and clarity on when we can expect other European countries to join the green list so that consumers and airlines alike can plan for this summer."
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Airlines UK, an industry body which represents UK carriers, said the Government must make "major additions" to the green list at the next review point in three weeks.
Chief executive Tim Alderslade said: "This is a missed opportunity and, with so few countries making it on to the green list, represents a reopening of air travel in name only.
"By contrast, the EU has said vaccinated people will be able to travel without restrictions, which leaves the UK at risk of falling behind and not opening up international travel to key markets across Europe as well as the United States."
Brian Strutton, general secretary of pilots’ union Balpa, accused the Government of an "excess of caution", adding that it is "extremely disappointing for everyone who works in the travel sector and the millions of people who are desperate to jet away on holiday or business".
"Almost all tourist hotspots in Europe including Spain, France and Greece are in the amber category, which is as good as red as far as most tourists are concerned, with potential 10-day quarantine needed on return," he said.
Meanwhile Thomas Cook said on Friday bookings were already up 250% on last week, with more demand expecting into the evening.
Comparing the whole of Friday to the whole of April 30, Thomas Cook said web traffic was 85% higher.
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Searches for Portugal saw a 264% increase, while there was a 277% rise in searches for Gibraltar – another destination on the Government’s green list.
Ahead of the government’s announcement, demand for flights to Portugal had already driven up prices as holidaymakers anticipated its green categorisation.
On Friday night, one of the most expensive travel options for May 17 appeared to a British Airways flight from Heathrow Airport to Faro in the Algarve, costing £436 or £530 depending on the time of day.
And budget airline Ryanair was offering flights from London Stansted to Portugal’s capital Lisbon for £65 on the same day.
Travel firm Jet2 said it was committed to restarting holidays from June 24.
Welcoming the planned partial reopening of international travel, CEO Steve Heapy said: "Despite ‘wanting to start looking outward again’ there is still a long way to go to meet the huge customer demand for our flights and ATOL protected package holidays, so we look forward to further positive news about where we can fly to in the coming weeks.
"We also look forward to important updates from the UK Government about a simple and affordable testing regime for customers."
He added: "Our customers can travel on their well-deserved holidays to destinations on the green list from June 24, and we expect a huge spike in searches and bookings to these destinations."