By the end of 1807, a French army led by General Junot entered Portugal at the northern border with Spain, to take Lisbon, the capital of the empire and main center of the commercial activity of the country, the city that was being used by the British despite the Continental Blockade Napoleon had decreed a year earlier. Prince Regent João, who had agreed on the French embargo to avoid war, fled from the French troops and embarked to Brazil, ending up in Rio de Janeiro by the beginning of 1808. The French invaded Portugal on two other occasions, in 1808 and 1811, and were finally expelled with the help of the British on the later date. Yet these events were to put an end to the old regime and leave the door open to the implementation of a parliamentary regime, much like those that would be introduced elsewhere in Europe. In 1820, a liberal revolution took place followed by the election of a Constitutional Assembly and adoption of a new constitution in 1822. This was only the beginning. The transition from the Ancién Régime to the new liberal order, however, took the best part of the first half of the nineteenth century and was punctuated by military coups, civil wars, and uninterrupted political unrest. The extent of the long institutional transformation was closely related to Portugal's level of economic, political, and social backwardness, which clearly made more difficult the needed consensus for change. To a certain extent, the implementation of the new political framework and the liberal economy emerging from it had to wait for another military coup, in 1851, the Regeneração, which ultimately led to the pacification of Portuguese society, at least for some decades, until other sources of distress emerged with the advent of the Republican forces.

The British Industrial Revolution and the spread of industrialization that ensued throughout the nineteenth century widened the gap in levels of income per capita within Europe, clearly distinguishing a core of industrializing countries and an outer periphery, to the south and the east, where the prevalence of backward agriculture lasted for several decades up to the twentieth century. It still is a point of lively discussion in the literature to define when that “little divergence” commenced in the European continent, whether it is a heritage from the Ancién Régime or a feature of the century of industrialization.