Italy "systematically and persistently" breached EU rules on air pollution, the European Court of Justice (ECJ) ruled on Tuesday.
The EU's top court said that data provided by Italy showed that daily and annual limits had been "persistently exceeded".
It added that Italy "failed, systematically and persistently, to fulfil its obligations" under a 2008 EU directive on air pollution and that it also "failed to adopt in good time appropriate measures to ensure that the period of exceedance of the daily and annual limit values for PM10 is kept as short as possible in the zones and agglomerations concerned".
PM10 is particulate matter 10 micrometres or less in diameter — also described as small or fine particles.
Because of their size, they are inhalable into the lungs and can cause adverse health effects.
The European Union set two limit values for PM10 for the protection of human health in a 2008 directive.
Under this directive, the PM10 daily mean value may not exceed 50 micrograms per cubic metre more than 35 times in a year and the PM10 annual mean value may not exceed 40 micrograms per cubic metre.
The European Environment Agency estimates that air pollution case around 400,000 premature deaths per year in Europe, making it the "single largest environmental health risk" on the continent.
The ruling was welcomed by Ugo Taddei, clean air lawyer for environmental NGO Client Earth.
"Italy is one of the worst countries in the EU for air quality and illegal levels of pollution have been a multi-year, nationwide emergency," he said.
"This ruling is the result of years of poor management of the issue at a regional and national level – a failure which has put people’s health on the line.
"This judgment should leave national leaders with no choice but to act without further delay. We need to see a complete turnaround, with new regional air quality plans that slash levels of pollution in the shortest time possible, to bring air quality within legal limits.
"Cities and Member States across the EU have been subject to legal action by civil society and by the EU itself because being forced to breathe dirty air is unacceptable in the 21st century. Now, in the face of COVID-19, we have all been reminded of how important it is to protect respiratory health. We can no longer pay the price of toxic air," he added.
The EU is now entitled to levy fines against Italy.
Prior to its case against Rome — launched in 2018 — Brussels had also successfully taken Warsaw to court over the issue.
It decided last month to take France to the ECJ "over systematic failure to meet EU rules on PM10 limit values" in Paris and on the island of Martinique for 12 and 14 years respectively.
The ECJ already sided with Brussels last year, ruling that France did not comply with the limit value applicable for the concentration of nitrogen dioxide in 12 air quality zones.