It would give you quite shallow DOF, yes, if you use it wide open.

The "Nifty Fifty" as we like to call it is a nice lens, surprisingly sharp, and it would offer shallow DOF at wider apertures, but I would not call that a portrait lens.

Even with a 1.6X FOV camera like the EOS XSi, that's a 80 mm equivalent lens, which is still not a portrait lens. If you use the 50mm f/1.8 up close enough to see a frame-filling face, that face will be distorted. IMHO, short-lenses with "close up" look are not flattering, they grossly distort body features. Hands will appear larger than heads, and so on. An alternative is to use the 50mm f/1.8 from farther away, but the problem with that is the lack of frontal image plane compression that a real telephoto lens would offer. So, again, the face looks distorted, just less so than when the 50mm is used close up.

IMHO, if you want to do flattering portraits, you need a 100mm or larger lens, used from farther away. So, in this context, if we're discussing modest in price, then one of the EF-S zoom lenses with a f/3.5-5.6 aperture, but >100mm equivalent focal length will be much better portrait lens. If cost is less of an issue, then the 135mm f/2L, 70-200mm f/2.8L, or 85mm f/1.2L lenses used from a distance will make still-more flattering portraits. They are sharper, have better out-focus-blur (bokeh), and more aperture than the Nifty Fifty; but of course all these great features come at a much higher cost. Still, an EF-S, or even a regular EF medium telephoto will give you much better portraits at less cost then L-series lenses.

Hope this is helpful input.

Blessings and Light,
M