3 Weeks Spain & Portugal Trip

Can you fly into Lisbon instead of Madrid? After a night of no sleep, it’s not wise to rent a car then drive five hours in a car, you’re not familiar with nor with your surroundings. With that said you do not need a car in Lisbon so you would need to park it. Furthermore, driving in Lisbon will be a pain.
You can take a direct bus from Lisbon to Lagos (4h). Hauling luggage with a baby will be easier by bus than train.
From Lagos take a direct bus to Seville: https://rede-expressos.pt/en (5h) and rent a car https://www.autoeurope.com/ the day you drive to Ronda. From Ronda drive to Nerja, from Nerja drive to Granada. From Granada drive to Barcelona and drop off car. Take a direct train from Barcelona to Madrid: https://www.renfe.com/es/en and buy your tickets before leaving home. This route sells out. Sleep in Madrid for two nights and take a day trip from Madrid (Todas station) to Toledo by direct train (45m). When you get off the train follow the crowd. You will need to board a bus and get off at Plaza Zocodover along with everyone else.

Ditto MaryPat--sorry to nag about it, but the driving around Madrid is a bit hectic (the beltway) and embarking on a long drive on no sleep is frankly terrifying to me.
I would also drastically reduce the moving around. I have a 51 year old baby, and he would not react to this plan very well.

You are going to find some of these cities will involve parking issues for you having a rental car. You might have to pay a lot just to park.
Places lke Lisbon, Seville, Madrid, Toledo (especially Toledo), etc.

Hello! We spent a month in Portugal last March…and am just starting to plan Spain for winter, 2026, so I can’t speak about that portion. We flew into Faro, PT from the US, and rented our cars through Avis, our agent’s name was David Silva. He has a Facebook page. We had credit cards that covered the insurance. We really enjoy nature, and loved the Algarve area. Our Benigal boat trip was cancelled because of wind, but the hike there was amazing!
We drove up along the coast then on to Evora(don’t miss the Bone Chapel!) We got rid of the car there, and trained into Lisbon(worked great!) Metros were great in the city, and Bolt (like Uber) was inexpensive. Loved training to Belem and Cascais, and then also overnight in Sintra - which worked well because we could get a Bolt ride up to the palace and be third in line! I think it cost us $5USD!
We then got a second car outside of Lisbon to travel on up the coast visiting many smaller areas, ending in Porto- again, turning in the car before training to the city. Just be sure your housing is near Metro stations! Hope this helps a little bit! Happy travels!

I'm not sure if this is still the case, but a few years ago, the rental cars in Portugal and Spain had different transponders for the highway tolls, so it was a concern to take a car between them. Is Madrid your only option to arrive and leave, because it seems that. you are barely seeing Madrid. If you have any flexibility, I would fly to Lisbon, rent a car at the end of your time there, see
Evora and Algarve, then ( if you can) drive to Spain, give Madrid 2 nights, and then fly home from Barcelona.

As well, it is nice to have 2 night stays if possible with a little one, otherwise you have long spells in each day. I would personally do a bit of rejigging to have less one night stays.

Picking up a car in one country and dropping it in a different country usually incurs a costly international drop charge.

Maybe it’s just me, a 74 year old experienced grandpa, but I would trim the trip down drastically, or better yet, postpone the trip for a few years. Spain and Portugal will still be there, and you will enjoy the trip much more.

Given what you said about going slow and enjoying the experience and not pre-booking much, I highly suggest cutting out many of your stops. Having more time in fewer places will mean less packing, less travel time with baby, more time to just enjoy a place.

An idea: about a week in Lisbon, train to Sevilla to stay about a week (with a day trip to Cordoba) and then about a week in Barcelona. Fly into Lisbon and out of Barcelona. Do train and plane rides instead of a car — then both of you are free to entertain and move freely about the train. And then plane will shorten the overall between spots travel time. Much easier, IMO, than driving, especially since he will be mobile and such. Also, by staying longer in one spot, you give yourself the freedom to buy some groceries, stay in a night, etc.

An alternate idea: Focus on a smaller geography. Those are very long distances you are covering, especially by car. Do one country instead of two.