Graca Paz, her husband and their three sons live in close quarters--in fact, their house in Portugal has only a few small rooms. But Graca decorates with such bright colors that the rooms pack a punch. "I'm passionate about how color plays with mood," she explains, and, we must admit, it's hard to imagine feeling crabby in her green kitchen, blue bathroom or pink terrace. "Not everybody likes this type of house," she says, "but 80 percent simply loves."

Tell us about your family. We have three boys--all eight years apart, but not on purpose! Coxi, 19, is studying fashion, the love of his life. He always said he'd be a fashion designer one day. Sebastian, 12, draws spectacularly and admires his old brother. Antonio is three. His favorite thing is to be with Sebastian.

Did you always have such a colorful home? A few years after I got married, I looked at my white house and decided it was time for a change. I painted the walls a Portuguese yellow. The impact was strong. My paintings looked transformed; I felt much happier. It was fantastic!

So you're a yellow fan? My life has stages of color: I had my yellow stage, now I'm in my pink stage. (I'm lucky to have a husband who loves my stages!) After this, I'm going to live in the countryside and do greens...

What a great use of fabric on the cupboard doors. Fabric paneling helps block the dust in the open cupboards, and I love mixing patterns in a room.

The green kitchen is gorgeous, too. Do you think a love of vibrant color is part of Portuguese culture? We have a strong tradition with color. We have the dresses of Viana do Castelo, the blue-and-white houses of Alentejo and the bright fishing boats of Nazare. Lisbon is yellow and pink.

What's it like to raise a family in Portugal? We live in Porto, a quiet northern city with well-preserved traditions. But raising kids here is, I think, quite limited because Portugal isn't very open-minded, like Denmark, Sweden or France. We miss a lot--like a Tate Modern museum where we can go constantly without getting bored.

How did you approach the decor in the boys' bathroom? The striped carpet is the unifying point. My house has lots of color and furniture but the carpets are the same in every room.

What's your favorite part of the house? My bedroom, which has a huge terrace and great view. I painted it strawberry, which makes it cozy. My husband built a fantastic wooden bed with so much personality. It's tall because I like to clean underneath easily. This is also Antonio's room, but he has his own corner.

How do your boys feel about all the color? Color is the first thing they see when they open their eyes. Color grew up with them and is part of them. Sebastian likes green; Coxi loves grey. Antonio always says our pink house is beautiful.

Do you think they would have turned out differently if they hadn't grown up around so much color? Yes. Depending on the colors you use, the ambiance will be cozy or happy or fresh or cold. In cities with great criminality, the jails paint the cells pink to make prisoners quieter. Plus, if you live in an artistic family, you have 90 percent of the ability to become one.

This bench is beautiful. Funny story: A boat had an accident near our house and dumped tons of wood onto the beach. People went crazy taking the wooden boards; my husband went to the beach with our dog and got some. The wood is well sanded and full of sea life.

You have a lovely, confident approach. What advice would you give new decorators? Never buy a complete set of bedroom furniture, never! I hate furniture sets where the bed combines with the wardrobe and table, and the curtains have the same flower as the bed pillows. Ahh... Things must start slowly so your house can grow with you.

For more, visit Graca's flickr site, etsy shop and website.