The luxury 270-room hotel will be located in a 20-storey exclusive tower as part of the Lisboa Palace development and is set to open in 2017.
Lagerfeld said: "I am very happy and proud to work on such a great project. An entire hotel designed by me. It's the first time for me; I think the idea is great."
The property will also have a a multi-purpose theatre for events, Michelin-starred restaurants and a themed retail mall. The resort will also have up to 700 gaming tables and 1,200 slot machines.