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At the beginning of World War I Italy remained neutral, since the Triple Alliance had only defensive purposes, and the war was started by Austria. However, both the central empires and the Entente tried to attract Italy on their side, and in April 1915 the Italian government agreed (London Pact) to declare war on Austria in exchange for several territories (Trento, Trieste, Istria, Dalmatia). In October 1917, the Austrians, having received German reinforcements, broke the Italian lines at Caporetto, but the Italians (helped by their allies) stopped their advance on the river Piave, not far from Venice. After another year of trench warfare, and a successful Italian offensive in autumn 1918, the exhausted Austria surrendered to the allies on November 4 1918, soon followed by Germany.

Football is the main national sport and the Italians are well known for their passion for this sport. Italy has won the Football World Cup three times: in 1934, 1938 and 1982.

In order to prevent the further expansion of Protestantism, the church endorsed the wars of the emperor Charles V (who was also king of Spain) and his successors, and started the so-called Counter-Reformation, with which it established a strict control over intellectual life in catholic countries.

The U.S.-Italian bilateral relationship is strong and growing. The U.S. and Italy cooperate closely on major economic issues, including within the G-8, which met in Genoa in July 2001. With a large population and a high per capita income, Italy is one of the United States' most important trade partners. In 2000 the United States was the fifth-largest foreign supplier of the Italian market and the largest supplier outside the EU. Total trade between the United States and Italy exceeded $33 billion in 1999. The U.S. ran a $12.1 billion deficit with Italy in 2000.

Unemployment has been steadily decreasing but remains high (8.6% in 2003, its lowest level since 1992). It is especially severe in the south where average unemployment exceeded 20% this year. Women and youth have significantly higher rates of unemployment than do men. A rigid labor market serves as a disincentive to job creation. There is a significant underground economy absorbing substantial numbers of people, but they work for low wages and without standard social benefits and protections.

Under the postwar settlement, Italy received most of the territories promised in the 1915 agreement, except for Dalmatia, which was mostly given to the newly formed Kingdom of Yugoslavia. - because some Italian workers, inspired by the Russian revolution began taking over their factories, mills, farms and workplaces. The liberal establishment, fearing a revolution, started to endorse the small Fascist Party, led by Benito Mussolini (a former socialist turned nationalist), whose violent reaction to the strikes (by means of the "Black shirts" party militia) was often compared to the relatively moderate reactions of the government. After several years of struggle, in October 1922 the fascists attempted a coup (the "Marcia su Roma", i.e. March on Rome); the fascist forces were largely inferior, but the king ordered the army not to intervene, formed an alliance with Mussolini, and convinced the liberal party to endorse a fascist-led government. Over the next few years, Mussolini (who became known as "Duce", leader) eliminated all political parties (including the liberals) and curtailed personal liberties with the pretext of preventing revolution.

The Apennine mountains form the backbone of this peninsula, leading north-west to where they join the Alps, the mountain range that then forms an arc enclosing Italy from the north. Here is also found a large alluvial plain, the Po-Venetian plain, drained by the Po River and its many tributaries flowing down from the Alps, Apennines and Dolomites. Other well-known rivers include the Tiber, Adige and Arno.

As a country, Italy offers many different faces, both culturally and geographically. The far north has many German speaking areas, popular destinations for skiing in the winter and walking during spring and summer. The Italian Lakes attract large numbers of visitors yearly, Tuscany (Toscana) and Umbria have been popular destinations for centuries, as has the Amalfi coast.

Europe's Renaissance period began in Italy during the 14th and 15th centuries. Literary achievements, such as the poetry of Dante, Petrarch, Tasso, and Ariosto and the prose of Boccaccio, Machiavelli, and Castiglione exerted a tremendous and lasting influence on the subsequent development of Western culture, as did the painting, sculpture, and architecture contributed by giants such as Filippo Brunelleschi, Leonardo da Vinci, Raffaello, Botticelli, Fra Angelico, and Michelangelo. Modern artists include the sculptor Tommaso Geraci.

Italy's dramatic self-renewal transformed the political landscape between 1992 and 1997. Scandal investigations touched thousands of politicians, administrators, and businessmen; the shift from a proportional to an Additional Member System (with the requirement to obtain a minimum of 4% of the national vote to obtain representation) also altered the political landscape.

At the end of the 18th century, Italy was almost in the same political conditions as in the 16th century; the main differences were that Austria had replaced Spain as the dominant foreign power, and that the dukes of Savoy (a mountainous region between Italy and France) had become kings of Sardinia by increasing their Italian possessions, which now included Sardinia and the north-western region of Piedmont. This situation was shaken in 1796, when French armies led by Napoleon invaded Italy; even if the states they created (e.g., Cisalpine Republic) were just satellites of France, they sparked a nationalist movement. Cisalpine Republic was converted in Italian Republic in 1802, under presidency of Napoleon.