A mountain of uncollected waste in Naples has prompted the EU to announce it is taking Italy to court.
More than 1,000 tonnes of rubbish is rotting on the city's streets, and the EU argues not enough has been done to get rid of it.
"The Commission is not convinced that this issue will be solved quickly enough," said an EU official.
Italy could face a heavy fine if the European Court of Justice decides that Rome has infringed EU laws on waste.
At the weekend, firefighters put out about 30 fires lit by residents unable to tolerate the smell from the rubbish - a smell made worse by recent warm weather.
The BBC's Rome correspondent Christian Fraser says temperatures soared in Naples over the May holiday and people set the waste alight out of concern that the approaching summer heat would bring a growing risk of disease.
Italy's newly elected Prime Minister Silvio Berlusconi has promised to tackle the crisis that has troubled the Campania region around Naples since 1994.
Naples' rubbish rots in its streets
He has promised to hold his first cabinet meeting in the city later this month and visit three times a week until he is sure a solution has been implemented.
Over the past 13 years, the authorities are estimated to have spent over 1.3bn euros ($2bn) trying and failing to clean up the streets.
Italy argues that part of the problem lies with the local mafia, the Camorra, who are said to control much of the waste business.
In a separate development, the European Commission issued a warning to the Italian government that it was not complying with an earlier ruling from the court of justice on the way rubbish was collected in the Lazio region.
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