Funchal (fōnshälˈ) [key], city (1991 pop. 109,957), capital of Funchal dist., on Madeira island, Portugal. A busy port exporting wines, fish, and fruit, it is best known for its beautiful setting and balmy climate, which make it a much-frequented resort. It has a late-15th-century cathedral and a convent church containing the tomb of João Gonçalves Zarco, who founded the city in 1421. See also Madeira Islands.