The victims, a man and a girl, are said to be aged 56 and 8, according to Portugese media.
People on the beach scattered in panic as the plane flew low over the sand, some running into the sea at the beach at Caparica, about 20 miles south of Lisbon.
The dead girl was with her parents, who were unhurt, witnesses told local television channels.
The plane passed over the dead man’s legs as he sunbathed on a towel, they said.
No others were reportedly hurt.
The two occupants of the plane are said to have survived the crash and were led away by police.
The small aircraft, reportedly a Cessna, was pictured close to the water edge with people gathered around.