Italian PM Silvio Berlusconi has approved the use of his country's air force in Nato's Libya mission.
Italy was ready to allow its jets to take "targeted military action", he said in a statement.
Earlier, a Nato air strike badly damaged buildings in Libyan leader Col Muammar Gaddafi's compound in Tripoli.
Nato is enforcing a UN resolution to protect civilians in Libya amid a revolt that began in February, inspired by other uprisings in the Arab world.
Mr Berlusconi announced the decision after a telephone call with US President Barack Obama, and would also call other European leaders to brief them personally, said his statement.
Italy had previously said it would not take part in Nato-led air strikes, citing its 40-year colonial rule of Libya.
Nato split
The UK has for weeks called for more commitment from Nato members to the operation in Libya, but on Monday Russia said the Western military intervention risked fanning a series of civil wars across the Middle East.
Russian Foreign Minister Sergei Lavrov said Western nations had sided with the Libyan rebels, leading to an expectation among rebel groups in the Middle East that foreign countries would help them to overthrow their governments.
"This creates a very dangerous mood," said Mr Lavrov.
"Unfortunately, it is probably contagious and it's popping up amongst protesters in other countries of this region with the hopes that they just need to aggravate the situation and then the international community will come to help, will take their side."
Russia abstained from March's UN resolution authorising a no-fly zone to protect civilians, and correspondents say the Kremlin feels Nato's bombing campaign has gone beyond what the resolution is designed to do.
Italy, France and Britain last week agreed to send military advisers to assist the Benghazi-based rebel Transitional National Council (TNC) in its battle against pro-Gaddafi forces.
The US launched its first Predator drone strikes pro-Gaddafi military positions over the weekend, which the Libyan government denounced as crimes against humanity.
'Agents, traitors and spies'
In some of the latest air raids by Nato jets, at least two missiles reportedly struck the Libyan leader's sprawling Bab al-Azizia compound early on Monday.
Correspondents said the blasts they caused were among the biggest explosions in the capital so far.
Government spokesman Moussa Ibrahim said Col Gaddafi was in a safe place and that his morale remained after what he called "an attempt to assassinate the leader and other political leaders of this country".
Mr Ibrahim said the air strike - which he described as "an act of terrorism" - killed three people and wounded 45.
Col Gaddafi's son, Saif al-Islam, condemned the "cowardly" attack.
"You, Nato, are surrounded by agents, traitors and spies, while Muammar Gaddafi is surrounded by millions," he said.
"So I tell you now that you are losing the battle. History has proved that no state can rely on them to win."
The BBC's Ian Pannell in Tripoli said the damaged buildings appeared to be the same ones that Col Gaddafi used to host a recent visit by an African Union peace mission.
The attack prompted three Libyan TV stations to go off-air for a brief period.
Three more loud blasts were reported in the capital on Monday night, although further details were not available.
Monday saw further fighting in the rebel-held city of Misrata, which has been besieged by government forces for two months.
At the weekend, the regime claimed to have suspended operations in the western coastal city, and its forces withdrew in places, says the BBC's Orla Guerin.
Since then, however, the deadly shelling has continued, with Misrata seeing some of the worst violence since the siege began.
Human rights groups say more than 1,000 people have been killed in Misrata and many more wounded. Ships have been ferrying the wounded to hospitals in the rebel stronghold, Benghazi.
