Alcoutim is a town and municipality situated in southeastern Portugal near the border with Spain. It serves as the administrative center for its namesake municipality, which covers an area of 575.36 km². The region is characterized by its low population density; as of 2011, the municipality had a population of 2,917 residents, making it the least densely populated municipality in Portugal.
The town of Alcoutim is located at the extreme eastern edge of the municipality on the Spanish frontier. It sits directly across the Guadiana River from the Spanish town of Sanlúcar de Guadiana in the Huelva Province. The surrounding territory is bordered by the municipalities of Mértola, Castro Marim, Tavira, Loulé, and Almodôvar, as well as the province of Huelva to the east.
A notable historical landmark within the municipality is the Moorish Alcoutim Castle. This fortification dates back to the 14th century and stands as a significant architectural feature of the region's eastern frontier.