And the potential carnage has been compared to a cataclysmic earthquake, which created a tsunami that killed more than 10,000 people in 18th century Portugal.
The claims were made in the film La Gran Ola, or 'The Great Wave'.
It warns that The Gulf of Cadiz - an area popular with tourists and expats - would be especially hard hit.
And the documentary's director suggests the ensuing disaster could be a repeat of the Great Lisbon earthquake of 1755.
He believes tens of thousands could be at be killed and hundreds of thousands more might be affected - through evacuation, power cuts and a lack of food and water.
The film interviews a number of scientists in the area, who echo some of the director's concerns.
They are particularly worried by the lack of an early-warning system, which would allow people to prepare for the impending wave to hit.
Begona Perez - head of the division of oceanography of Spanish ports - told the film-makers: 'The question is not whether there will be another tsunami, but when will it happen.'
Luis Matias, a researcher of tectonic and seismic risk at the Dom Luiz Institute in Portugal, added: 'In the Gulf of Cadiz, several faults could cause an earthquake any time.'
The Gulf of Cadiz sits on a major tectonic boundary, the Azores-Gibraltar fault.
This makes the area susceptible to earthquakes at sea, which can create tsunamis.
Speaking to The Olive Press, director Fernando Arroyo said: 'The only reality is that no scientist in the world can claim that it will not be repeated in the short term because there are no indicators in the area.
'It would affect hundreds of thousands of people and cause very high economic losses.
'For days, large areas could not be evacuated, there would be no electricity, no communications, no water, and entire cities such as Cadiz would have to be evacuated.'
When an earthquake, volcano or landslide happens on the ocean floor, water is displaced.
This water forms the start of the tsunami.
It is hard to see that a tsunami is approaching.
The most obvious sign is the coastal water retreats just before the waves reach the shore.
This is actually the trough of the wave following behind.
/Daily mail/
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