The leader of Portugal's 'Golden Generation', Figo won a FIFA World Youth Championship in 1991, the same year he made his senior debut against Luxembourg, at 16 October 1991, in a friendly match, that ended 1-1, when he was only 18 years old. He has performed at the highest level ever since, making appearances at Euro 96, Euro 2000, and the 2002 and 2006 FIFA World Cup. He announced his retirement from international football following the UEFA EURO 2004 final defeat by Greece, having won 117 caps and scored 31 goals. However, in June 2005 he reversed his decision and returned for 2006 World Cup qualifying wins against Slovakia and Estonia. He again vowed to retire from international football after the 2006 World Cup where he led the team to the semi-finals where Portugal lost 0-1 to France. He made his last appearance playing around 10 minutes at the end of the third place play-off game where he set up Portugal's only goal for Nuno Gomes in a 3-1 defeat against Germany.

On 18 August 2004 Figo announced that he would "take a break" from international football, although many sources suggested this was due to his inability to play good football. In April 2005, he announced to be ready to return, as he was sidelined in Real Madrid, and the next month Luiz Felipe Scolari announced he would talk to him about his return. Figo agreed to return on May 13 and resumed his international career in the match between Portugal and Slovakia on June 4. This received mixed feelings from Portuguese fans: some saw his return as fixing something that should not have happened, others were fearful of the "concessions" Scolari made to bring him back.

Figo captained the squad during the 2006 World Cup, leading the team to the semi-finals, where they were beaten 1-0 by France. This was the furthest Portugal had reached in the tournament since 1966. A dubious penalty, scored by French captain Zinedine Zidanestood as the winning goal. At the end of the match, Zidane and Figo, formerly teammates on Real Madrid during the club's glory years, swapped shirts and embraced. The third place playoff caused some controversy as Figo did not start; Pauleta captained the team in his place. However, Portugal fell behind 0-2 to hosts Germany and Figo replaced Pauleta in the 77th minute, regaining his captaincy during the substitution. Although Germany scored another goal shortly after Figo's entrance, he ended his final cap for his country on a high note as he set up Nuno Gomes's goal in the 88th minute to help Portugal claw back a marker.

Figo is married to Swedish model Helen Svedin. They met at a flamenco show and are now married with three daughters - Daniela (born in March 1999), Martina (born in April 2002), and Stella (born 9 December 2004). Along with his countryman, Manchester United assistant manager Carlos Queiróz, Figo was briefly joint seat holder for A1Team Portugal, in A1Grand Prix, during the 2005-06 season.