At present Portuguese law allows pregnancies to be terminated only in cases of rape, a deformed foetus or if the woman's health is at risk.
The "Yes" campaign to legalise the procedure has focused on an estimated 23,000 clandestine abortions every year, which Jose Socrates, the socialist prime minister, has called "Portugal's most shameful wound".
At present, women can be sent to jail if they abort.
The message that legalisation could end back-street abortions appeared to be working on some.
"I voted yes and will always vote yes," said Laurinda Duarte on her way to church.
"Abortions will always take place so why not vote to allow women to carry them out under decent conditions? I am a Catholic but that does not mean I am not free to vote."
Voting, due to end at 1900 GMT, picked up through the day as leaders on both sides of the campaign urged people to cast their ballots. "We cannot let others decide for us," said Socrates as he voted in the northern town of Covilha.
Catholic cardinal Jose Policarpo, the patriarch of Lisbon, said Sunday's election was a "vote of conscience".
If the turnout is below 50 per cent the vote will be invalidated, as was the case in a similar referendum in 1998 when only 32 per cent of the electorate voted.
But Catholic leaders have voiced concerns that a legalisation of abortion could sweep aside other traditional values in Portugal, which is western Europe's poorest country and one of its most conservative.
"No" campaigners have said a vote to lift the ban will increase the number of abortions and raise state health costs.
"I voted against legalising abortions because I believe it will banalise the practice," said Marta Paselar, as she left the voting booth with her husband. "I still hope the 'no' side wins."