"From a heritage perspective, this is the discovery of the decade," project director Jorge Freire said. "In Portugal, this is the most important find of all time."
In and around the shipwreck, 40 feet (12 meters) below the surface, divers found spices, nine bronze cannons engraved with the Portuguese coat of arms, Chinese ceramics and cowry shells, a type of currency used to trade slaves during the colonial era.
Freire and his team believe the ship was wrecked between 1575 and 1625 when Portugal's spice trade with India was at its peak.
In 1994, Portuguese ship Our Lady of the Martyrs was discovered near Fort of Sao Juliao da Barra, a military defense complex near Cascais.
"For a long time, specialists have considered the mouth of the Tagus river a hotspot for shipwrecks," said Minister of Culture Luis Mendes. "This discovery came to prove it."