Portugal has 6 festivals in this guide, spread across 5 cities. They run in June, July and August, and festival-day temperatures range from 24°C (75°F) to 36°C (97°F), with nights down to 16°C (61°F). That range is the reason there is no single "Portugal festival outfit". The answer changes by month and by site.
4 of them run in real heat (28°C or more), where loose natural fabrics beat coverage and a brimmed hat does more than any garment.
The ground matters as much as the sky. You will find city park, city streets, desert and beach, which puts closed boots or trainers you accept will change colour at the top of the list for most of these events. 3 of the 6 have camping on site, so outfits have to survive living in a bag on the ground for several days.
Stylistically the crowd here leans streetwear, indie, beach and alt. NOS Alive is the largest of them at around 55,000 people, and it sets the tone the smaller ones react to. None of that is a dress code. It is what you will see, which is worth knowing if you would rather blend in or deliberately not.