Groundwater is a crucial natural resource, vital for human consumption and sustaining industrial and agricultural activities. This study focuses on the hydrogeological characterization of the Penha Mountain region, Guimarães, northern Portugal. The area is characterized by a fractured granitic aquifer system contributing significantly to the local public water supply. The presented research aims to provide a detailed analysis of groundwater reservoirs, considering forty groundwater samples collected and analyzed for physicochemical parameters (e.g., electrical conductivity, temperature, pH, Eh, and total dissolved solids), during the wet and dry season, of a hydrological year. Additionally, sixteen representative dry season water samples were selected, and principal chemical elements and water isotopes were determined. The results revealed that Penha Mountain groundwater is slightly to weakly mineralized, with low total dissolved solids content (TDS: 14.1–59.0 ppm) and acidic to neutral (pH: 5.0–7.3). The hydrochemical facies indicated a dominant sodium-chloride water composition. Isotopic analysis suggested a meteoric origin, associated mainly with local water precipitation within a shallow flow regime at elevations between 455 and 525 m. Overall, the results demonstrate that groundwater is suitable for various uses, including human consumption, agriculture, and recreational activities. Furthermore, this study contributes to the development of a hydrogeological conceptual model for the aquifer system, highlighting the role of local faults and geological features in water–rock interaction. The findings provide valuable insights for sustainable groundwater management and environmental risk assessment in the region.