Observations from the CICLUS experiment (Climate Impact of Changes in Land USe), performed in Southern Portugal in 1997-99, are compared against boundary layer and mesoscale simulations with two non-hydrostatic models. The study focus on two days of intensive observations, with 3 hourly radiosondes in clear sky conditions, when the regional atmospheric circulation is dominated by a Heat Low type atmospheric circulation associate with the sea breeze cycle in the Iberian Peninsula. Surprisingly, the standard version of the COAMPS model fails to reproduce the observed boundary layer diurnal cycle, producing insufficient growth. Results are much improved with a new mixing length formation (Teixeira & Cheinet 2003, Teixeira et al 2004). A more substantial change of the PBL scheme, using a new Eddy-Diffusivity/Mass-Flux approach (Siebesma & Teixeira 2000, Soares et al 2004) is also tested. An analysis of the mesoscale circulation in the region indicates that the vertical profiles of specific humidity, characterized by a persistent and very dry layer just above the boundary layer top inversion, are related with the interaction between a low level cyclonic (heat low) circulation and the prevailing anticyclonic flow aloft.