The Council’s decision-making body, the Committee of Ministers, in its ruling praised the “authorities’ commitment” and said “significant results” had been achieved in recent months.
The ministers reported “an important and continuing drop in the prison population, and an increase in living space” for prisoners in Italy.
The judgement will come as welcome new to the Italian government, which last August pushed through a law aimed at tackling chronic overcrowding in the country’s prisons.
At the time Antigone, a prison rights group, said there were 142 inmates for every 100 places.
Under the new law, repeated offenders can be eligible for community service or house arrest, rather than automatically receive a jail sentence.
More recently politicians overhauled the drugs law, lowering penalties for marijuana, which is set to significantly reduce to the number of low-level criminals behind bars.