Helio Sousa's side was deserved and comprehensive winner in a match that underlined its credentials as a genuine title contender.
Nuno Santos gave Portugal a third-minute lead with a superb free-kick and it was no surprise when it went two ahead nine minutes into the second half.
The goal came from the penalty spot, and the award was inevitable after goalkeeper Alvaro Montero rushed from his goal to crash wildly into Andre Silva. The striker dusted himself down to coolly sent the keeper the wrong way.
Silva has been one of the stars of Portugal's campaign and on 67 minutes he doubled his tally with his third goal of the tournament, a looping header.
The only disappointment for Portugal came in the shape of an ultimately crucial consolation goal for Colombia, with Jarlan Barrera threading a pass through for Santos Borre to pick his spot in the bottom corner with a precise left-foot finish.
A second-half fightback saw Senegal see off Qatar 2-1 in the other Group C game, though the result only leaves it in third, meaning it faces an anxious wait on whether it reaches the Round of 16.
Akram Afif opened the scoring for Felix Sanchez's side, but the West African woke up after the break with stand-in captain Alassane Sylla and Moussa Kone earning it a lifeline.
The result ultimately meant Qatar goes home.
Serbia, meanwhile, clinched its place in the last 16 after eclipsing Mexico 2-0 on Saturday to secure top spot in Group D and send the Central Americans crashing out.
A goal right from the off by Nemanja Maksimovic put the Europeans on the front foot, before a stunning Andrija Zivkovic free-kick set up a fourth game of the tournament in Dunedin for Veljko Paunovic's side as it continued to impress in New Zealand.
The group couldn't have been more finely poised, with all four sides locked on three points, though Serbia began with its noses in front and Mexico just behind on account of a single goal for and against.
A win for either guaranteed progression, though a draw for Serbia was enough – which would have left Mexico hoping for a win in the group's other game.
Kick off wasn't even two minutes gone when Mexico's position became even more precarious, conceding a goal that will have infuriated coach Sergio Almaguer.
A long throw into the area found the head of Sergei Milinkovic at the byline with El Tri's defence napping. He then flicked across the box for Maksimovic to nod in an ultimately simple but very cleverly worked opener.
Chances were hard to come by, with Serbia happy to soak up the Mexican pressure and strike on the break, as a point was enough to guarantee the Europeans a top-two spot.
On one of their reactive forays forward Zivkovic almost capitalised on another long throw, but he only had to wait two minutes before taking advantage of a more traditional dead ball situation. In a tournament of fantastic free-kicks, he struck another beauty, curling into the top left corner from 25 yards.
Group D rivals Mali and Uruguay both qualified after a 1-1 draw that left them facing the drawing of lots to decide which of the two finishes second behind Serbia.
That draw took place in Auckland shortly after the sides were left with identical points and goal tallies.
The 'loser' of the lots draw advanced as one of the best third-placed teams, and the fact that a draw was enough for both was evident in the team's safety-first approach.
It was certainly not a match that will live long in the memory, with chances in extremely short supply and neither team willing to commit numbers to attack.
Uruguay's 17th-minute opener was a tribute to the intelligence of Franco Acosta. Mali had made a hash of clearing the ball out of defence and when Ramiro Guerra looped a header back into the area, Acosta applied the most delicate of glancing touches to deflect it past the keeper.
Mali responded with Adama Traore curling a powerful left-foot shot into the bottom corner from 16 yards for the equaliser.
That set up the result that both teams needed and, in truth, the second half - a complete non-event in terms of goalscoring chances - showed that.
