The 2006–07 European football season was the 103rd season of Sport Lisboa e Benfica's existence and the club's 73rd consecutive season in the top flight of Portuguese football. The season ran from 1 July 2006 to 30 June 2007; Benfica competed domestically in the Primeira Liga and the Taça de Portugal. The club also participated in the UEFA Champions League as a result of finishing third in the Primeira Liga in the previous season.

After manager Ronald Koeman's departure, Benfica immediately searched for a replacement. Media speculated the club would sign Sven-Göran Eriksson and later Carlos Queiroz, but Benfica signed the former Porto and Sporting CP manager Fernando Santos. Santos was the first manager since Fernando Riera to manage all of Portugal's Big Three clubs. In the transfer market, Benfica brought back Rui Costa and recruited other notable players including Katsouranis and David Luiz. Fabrizio Miccoli had his loan renewed for a second year, while Geovanni, Manuel Fernandes and Ricardo Rocha left the club during the season.

Because of their league finish, Benfica had to pass Austria Wien to enter the group stage of the season's Champions League. Domestically, Benfica's season started erratically, losing 11 points from three losses and a draw before December. In Europe, the situation was similar; Benfica never recovered a five-point deficit to Celtic by day three, ending with seven points and demotion to the UEFA Cup. From December until April, Benfica regained lost ground in the Primeira Liga, climbing to second place—a point away from Porto, which was also advancing until the quarter-finals of UEFA Cup

In April, Benfica had the opportunity to reach the league's top place if they won the Clássico with Porto; however, they only managed a 1–1 draw. It was the first of five winless games that caused them to drop to third place and be eliminated from Europe by Espanyol. Despite an improvement in form, Benfica wasted a chance to retake second place after another home draw against arch-rival club Sporting. Benfica ended the season in third place, with two fewer points than Porto, ensuring a place in the Champions League.

Season summary

Pre-season In the aftermath of Ronald Koeman's departure, Portuguese media began to speculate about Benfica's next manager. They initially focused on Sven-Göran Eriksson, who had previously managed the club and was in Algarve preparing for the World Cup with England's national squad. On 17 May, Eriksson said he had not been approached to join Benfica. José Antonio Camacho's agent dismissed speculation about his return. On 19 May, SIC Notícias announced Carlos Queiroz had signed a two-year deal with Benfica. Both parties immediately denied any agreement; Queiroz said he did not intend to leave Manchester United. The following day, Benfica presented Fernando Santos as the club's new manager on a two-year contract. Santos had last managed in Portugal in 2003–04, when he led Sporting to a third-place finish, and previously spent three years at Porto, winning five major titles. He became the third manager—the first Portuguese—to manage all of the country's Big Three football clubs, after Otto Glória and Fernando Riera. He would be assisted by Fernando Chalana, who remained connected with the club's management; Jorge Rosário as his long-term technical assistant; Bruno Moura as physiotherapist and Ricardo Santos as scout of the opponents.

Benfica's first signing of the season was Rui Costa nicknamed "The Maestro", who arrived for free and was well received by 3,000 supporters. He reportedly took a large pay cut to join Benfica. After Costa, Benfica selected Kostas Katsouranis as their top target in the search for another central midfielder. They negotiated with AEK Athens for over two weeks and agreed a transfer on 22 June. Benfica was also interested in signing Andrés D'Alessandro, but the deal fell through. In the offence, Fabrizio Miccoli had his loan deal renewed for a further season, and Benfica signed another option, Mexican striker, Francisco Fonseca. The biggest losses for Santos were the release of Geovanni—a regular starter for three-and-a-half seasons— and Manuel Fernandes, who joined Portsmouth on a loan deal.

The pre-season began on 3 July with medical exams during the morning and an afternoon visit to Nyon, where Benfica were camped during their pre-season tour of Switzerland. Santos implemented a new tactical formation based on the 4–4–2 diamond. Benfica played their first game against Swiss second-tier side Stade Nyonnais, beating them by a comfortable margin. They followed this with a win against Shakhtar Donetsk in Yverdon-les-Bains, and a loss against FC Sion at the Stade Tourbillon on 15 July. Benfica returned to Portugal on 16 July; they played a presentation match against Bordeaux on 22 July. They then competed in the 2006 Guadiana Trophy alongside their arch-rivals Sporting CP and Deportivo La Coruña, losing both matches. On 28 July, Benfica took part in the draw for the third qualifying round of the UEFA Champions League; they were paired with Austria Wien. Santos dismissed accusations of favouritism with the Austrians, saying, "It is a question of honour to be present in the Champions League, for me and for Benfica." Benfica's next preparation match was at AEK Athens on 1 August, where they lost for the third time in a row. The result caused concern to Santos because Benfica "showed a lot of tactical problems, both offensively and defensively." Benfica played their final preparation match on 15 August, where they defeated Estrela da Amadora 2–1.

August–September Benfica first competitive game of the season was the third qualifying round of the Champions League.Tovar, Rui. p. 631 Before the match, Santos expressed the importance of reaching the group stage: "More important than the formation used is to fulfil our purpose: take part in the group stage of the competition." On 8 August, Benfica visited the Ernst-Happel-Stadion to play Austria Wien. Benfica scored first with a back-heeled goal from Nuno Gomes in the 16th minute, while Austria equalized through Jocelyn Blanchard in the 36th minute. The match resulted in a draw and Benfica gained a decisive advantage for the second leg. On 22 August, Benfica hosted Austria Wien for the second leg. The opening goal came from Rui Costa, with further Benfica goals scored by Nuno Gomes and Petit. Benfica had joined their rivals Porto and Sporting in the 2006–07 Champions League, marking the first time three Portuguese teams were present in the group stage. On 24 August, Benfica took part in the Champions League draw; they were drawn with Manchester United, Celtic and F.C. Copenhagen. It was second time in a row Benfica played with Manchester United in the group stage after eliminating them in 2005–06. Three days later, Benfica were due to meet Belenenses for the opening game of the Primeira Liga. However, because of the "Mateus Affair," the game was uncertain to occur; Santos expressed hopes for the quick resolution of the case, adding that it was bad for Portuguese football and that the uncertainty caused his players to lose focus. Two days before the match, the Portuguese Professional Football League announced that the game was postponed until the Portuguese Football Federation decided the outcome of the affair.

Benfica's next match was scheduled for 10 September, meaning they would go nearly 20 days without competing in the opening stage of the season. After the international break in early September, their first match in the Primeira Liga was set for 9 September, one day earlier because of their European match against Copeganhen on 13 September. In an away visit to Estádio do Bessa, where Santos had never won in his career, Benfica were defeated 3–0 by Boavista. Santos said the defeat was "heavy and out of context" and blamed the ejection of Nuno Gomes for emotionally destabilizing the team. On the following Wednesday, Benfica played Copenhagen at Parken Stadium. Neither team could break the deadlock and the game ended in goalless draw.

On 17 September, Benfica received Nacional at home.Tovar, Rui. p. 628 With Simão making his league debut, Benfica scored the only goal of the match when Simão assisted Luisão in the 29th minute. On the following Friday, Benfica played Paços de Ferreira on the road. Katsouranis scored the first goal for Benfica but Paços equalized in the 92nd minute. In Santos' analysis, Benfica controlled the match, but after "an inexplicable ejection from Léo, the home team got back into the game." Four days later, Benfica received Manchester United for the second matchday of the group stage.Tovar, Rui. p. 632 A single goal from Louis Saha in the 61st minute won United the match and the lead in the group standings. It was Benfica's 12th loss in 20 matches against English teams in Europe and the fifth loss in six matches against United. Santos said Benfica played "60 minutes of great quality," but was disappointed with loss and expressed a desire to improve the situation.

October–November

October began with a home-match against Desportivo das Aves. Benfica scored first through Paulo Jorge, but Aves equalized with a goal by Filipe Anunciação. In the second half, Benfica scored three more goals from Simão, Nuno Gomes and Katsouranis to win the match. Nuno Gomes said, "I hope this win is a turning point for us." After another international break, Benfica played União de Leiria at the Dr. Magalhães Pessoa on 14 September. They continued with their good momentum and won 4–0, with Miccoli bagging a double. Santos was happy with his team's display, saying, "It was a great game and my team was focused, organized and dynamic, building a result that translated what happened on the pitch." On the next Tuesday, Benfica visited Celtic Park for the first of a double-header against Celtic. Benfica had the upper hand in the first half, but Celtic scored two second-half goals in a ten-minute window and finished the game with a third. The win gave Celtic with a five-point lead over Benfica with three matchdays to go. Santos blamed the loss on the team's lack of composure after conceding the first goal. He said he believed Benfica could still qualify for the next round.

On 22 October, Benfica hosted Estrela da Amadora. The visitors scored first though Dário, but Benfica equalized in the first half and scored two more goals in the second, winning the match 3–1. Santos was highly critical of the referee Carlos Xistra, who issued 18 yellow cards and three red cards, one of them to Miccoli, who would therefore miss the next match, a visit to Porto. Five days later, Benfica played Porto in the first Clássico of the season. In a high-tension match, Benfica conceded two goals in the first half but equalized in the second half, drawing the game in the 82nd minute. However, in injury time, Bruno Moraes scored, bringing the score to 3–2 to Porto. Santos said the result was unfair, adding, "After he got back into the game and managed to level it, 'that' happened in the end."

On 1 November, Benfica hosted Celtic; they scored two goals in the first 25 minutes and a third through Andrei Karyaka in the 90th minute, winning by the same margin they had lost in Glasgow. Santos was happy with the win, saying, "We knew he had three 'finals' and now we have two. We are better now, with four points and closing in on Celtic." Four days later, Benfica hosted Beira-Mar for a Primeira Liga match.Tovar, Rui. p. 629 Benfica did not score until the second half, when in the 51st minute, Katsouranis headed in the match's first goal. Three minutes later, Petit scored the second and an own-goal from Beira-Mar made the score 3–0.