Fossil remains of the predator were found entombed in limestone in a quarry in the north of the country.
The creature, which has been called a Saltriosaur, was more than eight metres (25 feet) long and weighed over a tonne.
Experts say it is one of the oldest meat-eating reptiles ever discovered.
Fossil remains of the predator were found entombed in limestone in a quarry in the north of the country.
The dinosaur was unusual in having three rather than four fingers which it would have used to grasp its prey. It also had a wishbone, an adaptation that some believe later gave birds flight.
Until now, experts had believed that these features arose much later in dinosaur evolution.
"This is possibly the most ancient three-fingered dinosaur," said one of the researchers, Cristiano Dal Sasso of Milan's Natural History Museum. "There are anatomical features typical of more evolved meat-eating dinosaurs."
Limestone grave
The dinosaur has been given the name Saltriosaur, after the quarry where the fossils were found. As well as those three-fingered clawed forelimbs, the meat-eater has a number of other distinctive features including sharpened, serrated teeth.
"Before our discovery, the most ancient dinosaur presenting such anatomical novelties was another meat-eating dinosaur found in 1994 by an American expedition to Antarctica," Dr Dal Sasso told BBC News Online.
The V-shaped wishbone is important because it is typical of birds and what may be their immediate dinosaur ancestors.
"A few years ago, palaeontologists thought such a bone was found only in small carnivorous dinosaurs such as the Velociraptor but not in these dinosaurs," said Dr Dal Sasso.
"About five years ago, such a bone, the furcular, was found by an American palaeontologist on the Allosaur, a large meat-eating dinosaur from the Upper Jurassic in Utah."
Like the North American Allosaur, the Italian dinosaur was a fierce predator. Its huge teeth and clawed fingers would have made it a ferocious killing machine.