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From 1861 until 1922, Italy was a constitutional monarchy with a parliament, mostly elected with restricted suffrage (in 1913, the first universal male suffrage election was held). The so called Statuto Albertino, which Carlo Alberto conceded in 1848 remained unchanged, even if the kings usually abstained from abusing their extremely large powers (for example, senators were not elected but chosen by the king). The new state faced immense problems, both because of the widespread poverty and illiteracy (especially in the south), and the deep cultural differences (for example, there existed no common language) between the various parts of Italy: there were even peasant insurrections asking for the return of former rulers.

All on its treat agriculture is typical of the division between the agricultures of the northern and southern countries of the European Union. The northern part of Italy produces primarily grains, rice, corn, sugarbeets, soybeans, meat, and dairy products, while the south specializes in producing fruits, vegetables, olive oil, wine, and durum wheat.

At the end of the 8th century the popes definitely aspired to independence, and found a way to achieve it by allying with the Carolingian dynasty of the Franks: the Carolingians needed someone who could give legitimacy to a coup against the powerless Merovingian kings, while the popes needed military protection against the Lombards. As a result, in 774 the Franks invaded and defeated the Lombards, and their leader Charlemagne was proclaimed legitimate king of the Franks by the pope. Later, in 800, Charlemagne was also crowned emperor of the Holy Roman empire by the pope; the new emperor (who was never recognized as such by the Byzantines) immediately conceded direct rule over central Italy to the pope, creating the Papal States.

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.

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.

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.

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.