Pictures of the slaughter were shared on social media.
Hunting individual animals is allowed but in this incident most of the zone’s deer population are said to have died.
The killing is thought to have taken place on a farm in the Torrebela tourist hunting zone, near Azambuja, about 40km (24 miles) from the Portuguese capital Lisbon on 17 and 18 December.
The 1,100ha (2,700-acre) farm is described as being walled in, meaning that the 540 animals had no means of escape from their killers.
The Environment Ministry said in a statement on Tuesday that “the reports and news about the indiscriminate slaughter of animals… have nothing to do with hunting, understood as a practice that can contribute to the maintenance of biodiversity and ecosystems”.
👮🏻♂️Portugal investigará a morte de 540 veados e xabarís 🦌🐗 a mans de 16 cazadores españois en Azambuja, Lisboa.
Segundo as primeiras investigacións os animais foron acurralados nunha finca e masacrados.
Logo, pendurárono todo nas redes sociais para indignación dos portugueses pic.twitter.com/RfRY6oj2jN
— Alberto Mancebo (@AlbertoMancebo) December 22, 2020
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