In a tweet, the Portuguese foreign affairs minister branded it "absurd" that Portugal had been left off the new list despite the UK having 28 times more deaths related to coronavirus.
Portugal's prime minister Antonio Costa tweeted a graph appearing to show the UK had a much higher number of cases per 100,000 population than the Algarve.
He said: "Which is the safest place to stay? You are welcome to spend a safe holiday in Algarve! #UK #visitportugal."
Labour and Which? Travel also said the measures announced on Friday were a "mess".
The Department for Transport (DfT) published the list of 73 countries and territories, which features popular short-haul destinations such as Spain, France, Italy, Turkey, Greece and Cyprus, as well as long-haul locations including Australia, Barbados, Hong Kong, Japan, New Zealand and Vietnam.
But China, Portugal, Thailand, the Maldives and the US are among the notable absentees.
Labour said the Government's failure to negotiate air bridges was "an indictment of their failure to tackle the crisis at home".
Shadow transport secretary Jim McMahon said: "Labour, like families and businesses up and down the country, are keen for the Government's quarantine measures to be lessened, but this is a mess.
"First we had the quarantine that they were slow to implement, then they said they'd do air bridges.
"Now we see a plan to let residents of 60 or more countries into England without any reciprocal arrangements.
"The fact they have been unable to negotiate air bridges is an indictment of their failure to tackle the crisis at home.
"They were too slow to take lockdown, too slow to order PPE (personal protective equipment) and too slow to protect our country."
The Foreign and Commonwealth Office (FCO) published a separate list of 67 countries and territories which will be exempt from its advisory against all non-essential travel from Saturday, making it easier for UK tourists to be covered by travel insurance while visiting.
Although the FCO included most of the places named by the DfT, among those missing are Fiji, Mauritius and the Seychelles.
There are also some destinations which the FCO listed but the DfT did not, such as Canada, Estonia, Malaysia, Slovakia, Slovenia, Singapore and the Portuguese regions of the Azores and Madeira.
Rory Boland, editor of Which? Travel, said holidaymakers having to check the two lists and for any restrictions in their destination country would be "forgiven for thinking this announcement hasn't been thought through".
He added: "The Government's attempt to relax international travel restrictions has been a complete mess, leaving millions of people with no clarity over whether their holiday can go ahead and less chance of getting their money back if they can't go.
"If the Government is to have any hope of getting travel back up and running, it must urgently provide clear and coherent guidance on foreign travel to remedy the mass confusion caused so far."
Noel Josephides, chairman of tour operator Sunvil, told the PA news agency that the omission of Portugal from the UK's quarantine-free list will "kill their peak season".
He added: "A lot of hotels are going to close, there's going to be considerable unemployment because of it, and it's totally unnecessary."
Mr Josephides said the impact on large tour operators such as Tui and Jet2 will be "quite serious".
However, Tui managing director Andrew Flintham said that he was pleased the Government had confirmed that "summer holidays are saved".
But the company said it will not be taking customers to any destinations where they will need to self-isolate when they arrive or when they return home.
Paul Charles, chief executive of travel consultancy The PC Agency and member of the Quash Quarantine campaign group, said: "It's an extensive list which will help many people who have holidays already booked.
"Let's hope some on the list relax their own restrictions soon so as to enable the travel economy to restart and recover successfully."
Joss Croft, chief executive of UKinbound, a trade association representing the inbound tourism industry, said: "English tourism businesses, in the inbound and outbound industry, will be breathing another sigh of relief today following the official Government announcement that arrivals from over 50 countries will no longer need to quarantine from Friday July 10.
"There are however a number of very important inbound markets that are still excluded, such as the USA, China and countries in the Middle East."