The country will be under "red-zone" restrictions over the public holidays, with non-essential shops, restaurants and bars closed, and Italians only allowed to travel for work, health and emergency reasons.
Italy has recorded the highest Covid death toll in Europe, with close to 68,000 fatalities.
Giuseppe Conte said Limited home visits will be allowed, that it was "not an easy decision".
"Our experts were seriously worried that there would be a jump in cases over Christmas.
"We therefore had to act," he said in a news conference.
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